Our Market Update for August 2020

Market Update for August 2020With the constant fluctuations of the market, it is increasingly difficult to stay up to date with the latest information on what moved the markets. Don’t worry! We are here with a day-by-day objective breakdown of what influenced the market for the month of August. Now, on to the market update for August 2020!

August 3, 2020

  • Markets start the month higher despite heightened geopolitical tensions
  • Stimulus discussions in Washington remain in focus
  • The 8:45 central time July manufacturing PMI index came in at 50.9, lower than the expected to be 51.3
  • The 9:00 July Institute for Supply Management index came in at 54.2, higher than the anticipated 53.5
  • June construction spending report decreased to -0.7%, missing estimates of 1.3%

August 4, 2020

  • Nasdaq hit a record high in the overnight trade but markets traded lower now as U.S.-China tensions and fiscal stimulus continue to worry the market
  • June factory orders report showed an increase, coming in at 6.2%, higher than the expected 5.2%

August 5, 2020

  • Markets advanced on stronger-than-expected corporate earnings reports
  • Nasdaq advancing to a record high
  • The ADP national employment change report was way off – showing employment with an increase of 167,000 in July when the market expectation was for a gain of 1.5 million
  • The July PMI services index came in at 50.0, slightly higher than the6 that was expected
  • July Institute for Supply Management non-manufacturing index came in at 58.1 vs the expected figure of 55

August 6, 2020

  • The jobless claims report showed a smaller than expected number
  • Jobless claims in the week ended August 1 were 1,186,000 when 1,442,000 were anticipated
  • Markets largely rallied on that news

August 7, 2020  (mid-day)

  • Stocks gyrated between gains and losses in early trading on Friday as better-than-expected jobs data partially offset lingering tensions between China and the U.S., as well as ongoing coronavirus stimulus negotiations
  • Reporting mid-day, the Dow traded 34 points lower, or 0.12%, the S&P 500 remained flat, and the Nasdaq slid 0.36%

August 10, 2020

  • Markets are higher despite increased tensions between the U.S. and China and potential complications surrounding fresh federal stimulus spending plans
  • The S&P 500 futures hit the highest level since February 24 today and has recently filled the gap on the daily chart at 3300.75-3327.25 (record high for the September S&P 500 futures is 3396.50)
  • The Labor Department’s June Job Openings and Labor Turnover Survey (JOLTS)–which tracks the monthly change in job openings and offers rates on hiring and quits–came in at 5.889, higher than the expected total of 5.288 million

August 11, 2020

  • Stocks attempted but failed to retake their February highs
  • There was a big slide in the Tech sector, with the tech-heavy Nasdaq now trailing below the S&P 500 and the Dow Jones
  • More remarkably was the plunge in gold and bonds

August 12, 2020

  • The consumer price index (CPI) came in at 0.6%, higher than the 0.3% consensus
  • Year over year change shows a figure of 1.0%, and minus food and energy, an uptick to 1.6%
  • A strong bounce in Tech carried the market to the cusp of a record high.
  • Gold also rebounded along with stocks as demand for the yellow metal continues, many investors likely seeing the correction as a buying opportunity

August 13, 2020

  • US indices are flat as stimulus talks in Washington remain deadlocked.
  • The S&P 500 is closing in on its record high at 3396.50
  • Jobless claims in the week ended August 8 came in under one million, specifically, at 963,000 when 1,150,000 were expected

August 14, 2020  (mid-day)

  • Reporting mid-day, the big three indexes are largely flat as talks in Washington over a fresh round of economic stimulus remain stalemated
  • Investors are awaiting trade talks between senior U.S. and Chinese officials, scheduled for Saturday
  • Retail sales in July rose 1.2% when a gain of 2.0% was expected, and retail sales less autos were up 1.9% when an increase of 1.5% was anticipated
  • July industrial production increased 3.0% as expected, and July capacity utilization was 70.6%, which compares to the predicted 70.3%

August 17, 2020

  • US indices advanced despite the stalemate in Washington over a fresh round of economic stimulus and ongoing US-China tensions
  • The August Empire State manufacturing index came in higher at 3.7 when 17 was expected
  • The August housing market index came in at 78, higher than the anticipated t72
  • The September S&P 500 futures is closing in on its record high of 3396.5

August 18, 2020

  • The Nasdaq advances to a record high
  • Stocks advance despite the stalemate in Washington over a fresh round of economic stimulus, along with ongoing tensions between the U.S. and China
  • There were 1.495 million building permits issued in July when 1.300 million were expected and there were 1.496 million starts, which compares to the anticipated 1.240 million

August 19, 2020

  • The S&P 500 and Nasdaq set new record setting highs but lost steam toward the end of the day
  • Federal Reserve FOMC minutes muted market optimism, stating that the economy is facing an “extraordinary level of uncertainty and risk” stemming from COVID-19, raising fears of a possible resurgence
  • Apple Inc hit a milestone, crossing $2 Trillion in market cap for the first time
  • Mortgage applications to purchase a home increased 1% for the week and were 27% higher compared with one year ago

August 20, 2020

  • Stocks drifted higher in choppy trading with the Dow snapping a three-day losing streak and the Nasdaq snatching a new high at the close
  • Disappointing economic news set the tone as the weekly jobless claims report came in once again over 1 million
  • But the market shrugged off the data, rising toward the end of the day

August 21, 2020  (mid-day)

  • Mid-day, stocks are rising, lifted by strong U.S. economic data, to end a week that saw the broader market reach a record level
  • The Dow Jones Industrial Average traded 140 points higher, or 0.5% The S&P 500 gained 0.2%, and was on track for a record closing high. The Nasdaq Composite advanced 0.25%

August 24, 2020

  • S&P 500 and Nasdaq advanced to new record highs
  • Traders await the US Federal Reserve’s annual Jackson Hole meeting later in the week
  • The July Chicago Federal Reserve national activity index was 1.18, which compares to the revised 5.33 last month
  • Traders are under the assumption that the Federal Reserve will do more to support the economy if required

August 25, 2020

  • Global equity markets were getting a boost on a renewed commitment by the U.S. and China to their phase one trade deal following a phone call between the two sides late Monday
  • The U.S. statement included details including protection of intellectual property rights, while the Chinese statement kept to broad generalities
  • The August consumer confidence index was expected to be 93 but came in lower at 84.8
  • July new home sales were anticipated to total 774,000 but came in stronger at 901,000

August 26, 2020

  • Stocks rise with the S&P 500 and NASDAQ advancing yet again to new record highs
  • July durable goods orders increased 11.2% when up 4.3% was expected
  • US stock indexes continue to have upside momentum

August 27, 2020

  • Today’s main event is Federal Reserve Chairman Jerome Powell’s speech at the Kansas City Federal Reserves 44th Annual Economic Policy Symposium
  • Stock index futures advanced when Chairman Jerome Powell called for a robust updating of Federal Reserve policy
  • The central bank formally agreed to a policy of average inflation targeting, which means it will allow inflation to run moderately above the Feds 2.0% goal for some time following periods when inflation has run below that objective
  • The second quarter GDP contracted 31.7%, which compares to the expected 32.9% decline
  • Jobless claims in the week ended August 22 were 1,006,000 when 987,000 were anticipated
  • July pending home sales index is estimated to be up 1.5% but delivered a blowout 5.9%

August 28, 2020  (mid-day)

  • S&P 500 and NASDAQ futures advanced to a record high overnight after yesterday’s speech from Federal Reserve Chairman Jerome Powell but since then had taken a breather
  • Chairman Powell called for a robust updating of Federal Reserve policy. The central bank has formally agreed to a policy of average inflation targeting, which means it will allow inflation levels to run moderately above the Feds 2.0% goal for some time following periods when the rate of inflation has run below that objective
  • July personal income increased 0.4% when a decline of 0.2% was expected

August 31, 2020

  • US indexes are mixed as the S&P 500 and Dow Jones Industrial Average wrapped up their best August performances since the 1980s
  • Declining bank stocks pressured the Dow and S&P 500, with JPMorgan Chase, Citigroup, Bank of America and Wells Fargo were all down more than 1%, following Treasury yields lower
  • The Nasdaq got a got a lift after two big stock splits – Apple and Tesla -took effect

All in all, August made for an active and interesting month for the markets. We are excited to see what September brings as the government and corporations alike finalize some big decisions that will sway the markets one way or another! Visit us on Instagram, Facebook, Twitter, and LinkedIn for frequent market updates and financial wellness motivation! Thanks for reading!

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