Market Recap for Sunday, July 16th, 2017
Stocks struggled early last week, with traders focused on the White House.
At first, it looked like news of Donald Trump Jr.'s involvement with a Russian lawyer during the Presidential campaign would have a big impact on the markets. When Trump Jr. shared personal emails on Tuesday about the meeting, stocks sold off quickly.
But the major indices recovered from the drop. And after 2 days of trading, stocks had gone nowhere.
After the slow start to the week, traders turned their attention to Fed Chair Janet Yellen's semi-annual testimony before Congress.
Yellen's testimony on Wednesday and Thursday didn't produce any real surprises. But during her testimony Yellen said that the federal funds rate "would not have to rise all that much further" to reach a level that neither encourages or discourages economic activity. Traders took this as a sign that the Fed doesn't plan to slow the economy, and might be a little less aggressive with rate hike plans.
The major indices gained some momentum following Yellen's testimony, and the probability of a rate hike in December dropped. Fed funds futures now show a 50.6% probability of a rate hike in December, down from 59.1% a week ago.
At the end of the week, the S&P finished with its largest weekly gain since May, and the S&P and DOW ended the week at record highs. And while stocks are trading at highs, "fear" and volatility are at multi-decade lows...on Friday the VIX (aka Fear Index) finished at a 24-year low.
Here's where the major indices ended the week:
- The S&P finished with a 1.4% gain. The S&P added 34 points and ended at 2,459.
- The DOW ended 1.0% higher. Up 223 points, the DOW closed at 21,638
- The NASDAQ was up 2.6%. Adding 159 points, the NASDAQ finished at 6,312.
Crude Oil (CL) finished higher every day last week. With a 5.1% gain, CL ended the week at $46.52 a barrel.
On Friday, 2nd quarter earnings season officially got under way with JP Morgan Chase (JPM), Citigroup (C), and Wells Fargo (WFC) all reporting. These stocks beat expectations, but retreated on Friday.
Earnings will remain in focus this week, especially since we have a pretty quiet economic calendar.
Here are this week's key reports (all times ET):
- MONDAY - Empire State Manufacturing Index at 8:30am.
- TUESDAY - No major reports.
- WEDNESDAY - Building Permits & Housing Starts at 8:30am and Crude Oil Inventories at 10:30am.
- THURSDAY - Unemployment Claims and Philly Fed Manufacturing Index at 8:30am.
- FRIDAY - No major reports.
This Week's Economic Calendar
Real Time Economic Calendar provided by Investing.com.
Have a great trading week!