The Dow Jones, the S&P 500, and the Nasdaq weakened on Friday as investors have started to behave nervously as Amazon shares dropped after the company forecast lower sales growth. Despite this, Wall Street’s three main indexes ended higher on a monthly basis and continue to trade in a bull market.
The S&P 500 index rose 2.3% in July 2021; the Dow Jones Industrial Average advanced 1.3%, while the Nasdaq Composite Index advanced 1.2% on a monthly basis and closed at 14,672 points.
“Strong earnings and the continued rebound in the U.S. economy have helped to support stocks this month, but the rapid spread of the Delta variant of the coronavirus and rising inflation have been concerns,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.
Last week, the U.S. central bank left its monetary policy unchanged even though the economy has continued to progress while U.S. Federal Reserve Chairman Jerome Powell said that inflationary pressures are likely to be temporary. The U.S. Federal Reserve is still a ways away from considering raising interest rates because its goal of stable prices and maximum employment has not yet been achieved.
The U.S. published the preliminary estimate of the second quarter’s Gross Domestic Product, and according to the report, the economy grew at an annualized pace of 6.5%. The U.S. consumer spending rose more than expected in June while the jobless claims fell to 400,000 for the week ended July 24.
The U.S. will publish the Nonfarm Payrolls report on Friday, and this will be one of the main events of next week. The U.S. economy is expected to have added 926K new jobs in July, while the unemployment rate is also expected to show improvements.
