The major stock market indices all posted moderate losses last week – snapping their 5-week winning streak. The Dow Jones Industrial Average fell .6% to 36,100 – the NASDAQ Composite lost .7% to 15,861 – and the Standard & Poor’s 500 Index dipped .3% to 4,683.
A major news item out last week was the Consumer Price Index for October, which showed an inflation reading of 6.2%, its hottest level in over 30 years. Also, the University of Michigan’s Consumer Sentiment Index fell to a 10-year low of 66.8. The disappointing number is likely due in part to inflation worries, which is increasingly on the mind of investors.
Looking to week ahead, it’s what we refer to as retail week. Retailers reporting this week include Advance Auto Parts, Home Depot, Lowe’s, Target, TJX Companies, Walmart, Kohl’s, and Foot Locker. Retail Sales data is also upcoming this week, with the Census Bureau releasing October’s number tomorrow. Market expectations are for an increase of .85%
Away from the retail sector, we’ll get earnings reports from companies including Tyson Foods, Warner Music Group, NVIDIA, Cisco Systems, and Palo Alto Networks. Overall, results for third quarter earnings have come in better-than-expected, and that has been fuel for the stock market.
Of the 459 companies in the S&P 500 that have reported earnings to date for the third quarter of 2021, 80.4% have reported earnings above analyst estimates, which compares to a long-term average of 65.8% – according to I/B/E/S data from Refinitiv. As always, please feel free to contact us with any questions you may have or if you would like to set up an appointment.
All the best – Southport Station Financial Management, LLC