US equity market remains upbeat and optimistic ahead of the CPI data release for the month of July 2023.
US equity indices started the week on a strong footing with the Dow Jones Industrial Average gaining more than 400 points or 1.16% to close at 35,473.13. The blue-chip index registered its best day since June 15. Among all the Dow-listed stocks, Amgen was leading the rally with 4% gains.
Other indices also made significant advances with the S&P 500 gaining 0.9% to close at 4,518.44. On the other hand, the tech-heavy Nasdaq Composite surged 0.61% to close at 13,994.40.
After a week of losses on Wall Street, there have been some changes in the market. Last week, the Nasdaq Composite and S&P 500 went down by around 2.9% and 2.3%, respectively, making it their worst-performing week since March. The Dow also ended the week with a 1.1% decline.
Starting on Monday, a new phase of the ongoing corporate earnings season kicked off, which has generally been better than expected. Out of the companies in the S&P 500 that have reported their quarterly results, about four out of five have performed better than what was predicted by Wall Street, according to FactSet. Speaking on the development, Chris Zaccarelli, chief investment officer of the Independent Advisor Alliance said:
“Markets are back on to a risk-on mode. It’s been a better-than-expected earnings season, and so I think that’s why the market’s had such staying power.”
Ahead of this week, investors will put focus on the Consumer Price Index (CPI) data for July 2023. This data shall influence Fed’s decision for the next interest rate hike, scheduled next month for September.
Stock-Specific Performance on Wall Street
Berkshire Hathaway’s shares went up by over 3%, indicating that investors were pleased with the company’s earnings report and its strong cash reserves. Both classes of shares, A and B, reached record highs on Monday.
Animal health care company Elanco saw a 4% increase in its stock value after surpassing the expectations of Wall Street. On the other hand, Tyson Foods experienced a 3.8% decrease in its stock value due to a report that didn’t meet expectations.
Sovos Brands, which is known for Rao’s products, saw a remarkable surge of more than 25% in its stock value after an announcement that Campbell Soup would be acquiring the pasta sauce maker. However, Campbell Soup’s shares declined by around 1.8%, bringing their price to the lowest it has been in over a year.