Today’s Stock Market: Dow Nabs Hit Record Ahead of Labor Day

VaselineAugust 30, 2024

0 3 minutes read

Today’s Stock Market: Dow Nabs Hit Record Ahead of Labor Day

Stocks were choppy on Friday as volume eased ahead of the long holiday weekend. As a reminder, Monday is a stock market holiday, with both the stock and bond markets closed for Labor Day. Today, however, investors got a not-so-terrible update on inflation and a round of retail gains.

Starting with economic data. All eyes were on this morning’s release of the Consumer Price Index and Personal Expenditure (PCE), the Fed’s favorite. inflation measure, which rose 0.2% month-over-month in July and rose 2.5% year-over-year. Core PCE, which excludes volatile food and energy prices, rose 0.2 percent on a monthly basis and was up 2.6 percent from a year ago.

The data also showed that personal income rose at a slightly faster-than-expected 0.3 percent rate, while a 0.5 percent rise in consumer spending matched economists’ forecasts.

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“As for this morning’s PCE, which came in as expected, no news is good news,” said Gina Bolvinchairman of Bolvin Wealth Management Group, in a statement. “The track is clear for the Fed to cut rates in September. The only question is whether the discount will be 0.25% or 0.50%.

According to the CME group FedWatch toolfutures traders are currently pricing in a 69.5% chance the central bank will cut federal funds rate by a quarter of a percentage point at its next meeting. The odds for a half percentage point reduction are 30.5%.

Elsewhere, data from the University of Michigan showed that Consumer Sentiment Index it rose to 67.9 in August from 66.4 in July. The survey also showed that households’ one-year inflation expectations now stand at 2.8%, down from 2.9% in July. The five-year inflation estimate remained unchanged at 3%.

Wall Street says you buy a bathroom at Ulta

In single-stock news, The ultimate beauty The stock ( ULTA ) fell 4% after the beauty retailer it was below high and low expectations for the second quarter and lowered its outlook for the full year.

However, this is more of the same for consumer discretionary stock. While the stock got a short-lived boost earlier this month, news of Ulta being added to Warren Buffett’s Berkshire Hathaway Stock Portfolio in Q2, they remain 28% lower for the year to date.

However, analyst Oppenheimer Rupesh Parikh (Outperform, the equivalent of a Buy) “looks favorable on ULTA’s long-term outlook,” citing the company’s differentiated offerings, potential to deliver above-average growth rates in retail and strong management as some of the reasons it is bullish.

“We continue to see ULTA stock as suitable for long-term players and would take advantage of any dip from here,” adds Parikh.

Lululemon slips after missing top line

Lululemon Athletica Shares ( LULU ) rose 0.2% after the athleisure company reported lower than expected income for the second quarter and lowered its outlook for the full year due to “uncertainties in the macro environment.”

Wall Street doesn’t seem overly concerned about LULU’s near-term struggles. “Lululemon has a strong brand and growing e-commerce sales, which we expect to drive higher margins over the next few years,” says Argus Research analyst. John Staszakwhich maintained a Buy rating on the stock after earnings. “Overall, we believe the company’s outlook is among the best in the apparel sector.”

As for the main indices, the Dow Jones Industrial Average rose 0.6% to 41,563 – good for a new high close – the S&P 500 added 1.0% to 5,648, and Nasdaq Composite rose 1.1% to 17,713. Stocks closed mixed on the week but higher on the month.

VaselineAugust 30, 2024

0 3 minutes read

Vaseline

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