Stocks start August higher after posting 6th monthly gain
Stocks were rising Monday as investors embraced another strong set of earnings as well as progress in Washington on passing a major infrastructure package
SINGAPORE — Stocks were rising Monday as investors embraced another strong set of earnings as well as progress in Washington on passing a large infrastructure package.
The S&P 500 index was up 0.1% as of 1:27 p.m. Eastern. The benchmark index ended July higher, its sixth straight month of gains.
The Dow Jones Industrial Average rose 27 points, or 0.1%, to 34,963 and the Nasdaq composite was up 0.4%.
Technology companies made some of the broadest gains, while a variety of retailers and other companies that rely on direct consumer spending also rose. Makers of consumer and household goods, along with raw materials companies, lagged the market.
This week will be busy for investors. Roughly 150 members of the S&P 500 will report their results, and the July jobs report comes out on Friday.
Companies that will report this week include DuPont, Eli Lilly, CVS, Kraft Heinz, General Motors and Humana, among many others.
So far earnings season has been strong for corporate America, with the average S&P 500 company reporting an 85.1% growth in profits from last year. Roughly nine out of ten companies have beaten expectations on both profits and revenue. The index is on pace to have its strongest earnings season since 2009.
In Washington, Republicans and Democrats made progress in advancing President Biden’s infrastructure package over the weekend. The package is expected to be passed in the Senate by the end of the week.
Construction equipment maker Caterpillar, which would stand to benefit from more spending on infrastructure, rose 0.4%.
Square rose 11.7% after the payments company said it would acquire the “buy now, pay later” company Afterpay for $29 billion.
Bond yields were falling again. The yield on the 10-year Treasury note fell to 1.16% from 1.24% on Friday. Crude oil prices were down 3.8%.
Investors are still closely watching any developments with the virus pandemic and how mutations and variants might impact economic growth, though analysts don’t expect a big pullback in consumer or economic activity.
“The impact on the economy will be considerably more limited than it was in previous waves,” said Gary Schlossberg, global strategist at Wells Fargo Investment Institute.
Investors are also getting a few pieces of economic data this week that could help them better gauge the economy’s health.
The Institute for Supply Management, a trade group of purchasing managers, said manufacturing slowed in July. Many companies are being held back by supply chain issues. The trade group will release its report on the services sector on Tuesday, which is a much bigger piece of the U.S. economy.
