After what looked like a pause mid-week, the market continued the party last week, pushing the S&P 500 above the psychological 1,000 mark and the Nasdaq to the 2,000 level. Markets clocked a fourth straight week of gains and climbed to the highest level since November. For the week ended August 7:
Dow: Up 2.2% to 9,370.07
S&P 500: Up 2.3% to 1,010.48
Nasdaq: Up 1.1% to 2,000.25
A better-than-expected jobs report and earnings reports boosted markets higher. In months past, the jobs report has been the party pooper for the market. This time it was finally different -- 247,000 jobs were lost in July, bringing the unemployment rate down to 9.4% from 9.5% in June. Economists were expecting the unemployment rate to tick up to 9.6%. It was the fewest number of jobs lost since August 2008. While still a sizeable chunk, it is a far cry from the job losses we’ve seen in previous months.
Earnings breakdown
Though we’re seeing improved signs of recovery, it’s still a mixed bag for earnings. Consumers are still reticent to spend, and operating conditions, though improved, have a ways to go before full recovery. We’ll need to see an improvement in year-over-year comparisons, not just sequential numbers, before we know we’re on our way.
Consumer basics giant Procter & Gamble (NYSE: PG) posted an 18% decline in fiscal fourth-quarter earnings, due in part to a slump in sales of premium-priced products, as budget-conscious customers traded down to private, less expensive labels.
Toyota (NYSE: TM) posted a loss in its fiscal first quarter as demand for cars remained weak and the yen remained strong. On the upside, the Japanese automaker said it sees a smaller-than-expected loss in the first half of its fiscal year ending Sept. 30, on strong Prius sales, raised sales targets in Japan, and cost-cutting.
Whole Foods (Nasdaq: WFMI) saw fiscal third-quarter earnings rise a penny on cost-cutting. In an encouraging sign, the company saw its first sequential improvement in comparable-store sales trends in six quarters. Continued... |