Stocks Mostly Higher Amid Week of Economic Data, Fed Updates

The S&P 500 is on a winning spree

Deputy Editor
Aug 28, 2020 at 2:45 PM
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The S&P 500 (SPX) and Nasdaq Composite (IXIC) continued their record-breaking rallies, both starting the week with fresh all-time closing highs. Continuing into the week, both indexes nabbed another set of record peaks on Wednesday, as big tech and vaccine optimism permeated the market. Not to be forgotten, however, the Dow Jones Industrial Average (DJI) came into Monday red-hot, and spent the last couple days flirting with its year-to-date breakeven point. The blue-chip index also made headlines with its stock shakeup thanks to Apple's (AAPL) stock split. All three indexes are now on track for a weekly gain -- the SPX and IXIC's fifth straight -- while the SPX is also eyeing its seventh consecutive daily gain. 

Along with COVID-19 updates, economic data moved the market this week as well. The dropping number of newly confirmed coronavirus cases boosted sentiment at the start of the week, however, disappointing consumer confidence data weighed on Tuesday, despite U.S. home sales rising. Later on, Thursday was jam-packed with better-than-expected adjusted second-quarter gross domestic product (GDP) data, weekly jobless claims, and Federal Reserve Chairman Jerome Powell's announcement that the central bank agreed to "average inflation targeting," which will allow inflation to run moderately higher for "some time."

Pharmaceutical Stocks Highlighted

As part of the new normal, the week featured a few high-profile names offering up COVID-19 pipeline updates. Moderna (MRNA) announced its enrollment levels for its late-stage trials have exceeded 40%, but more government money from rival AstraZeneca (AZN) weighed on the shares. Meanwhile, Abbott Laboratories (ABT) soared after the Food and Drug Administration (FDA) granted Emergency Use Authorization to its COVID-19 portable antigen test.

In news beyond the pandemic, Teva Pharmaceuticals (TEVA) found itself in hot water amid U.S. Justice Department charges of drug price fixing. Acadia Pharmaceuticals (ACAD) received a lofty new rating and price target, and medical device maker Medtronic (MDT) toppled a stiff ceiling after a top-line beat.

Earnings Reports Shift Retailers

Though the most recent earnings season has, for the most part, come and gone, many popular retailers are still making moves based on their quarterly reports. Most notably, one of the stocks set to join the Dow on August 31, (CRM), soared to its best day ever after a stellar fiscal third-quarter earnings and revenue. Also rising after their reports were Abercrombie & Fitch (ANF) and Tiffany & Co (TIF), despite the latter's revenue miss. 

On the other hand, discount retailers Dollar Tree (DLTR) and Dollar General (DG) plummeted despite their earnings beats. Digging deeper, Nordstrom (JWN) and Coty's (COTY) dismal reports didn't do them any favors either.

Breaking Down Trends in the S&P 500

Digging a little deeper, our Senior Quantitative Analyst Rocky White dove into what happens after the S&P 500 Index  (SPX) notches a fresh record high. Meanwhile, Senior V.P. of Research, Todd Salamone, looked into what type of behavior the SPX is repeating.

Much like this week, the last day of August and the start of September will begin with a whimper. However, on the whole, investors will still have jobs data, manufacturing numbers, and the latest weekly jobless claims to pore over next week. And there's even some earnings stragglers' set to report, including At Home Group (HOME), Broadcom (AVGO), Ciena (CIEN), CrowdStrike (CRWD), DocuSign (DOCU), and Zoom (ZM).


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