In the late hours of Monday, stock futures exhibited minimal movement as investors directed their attention towards the concluding days of a challenging August for the market.
Futures linked to the Dow Jones Industrial Average recorded a marginal gain of 15 points, equivalent to 0.04%. Meanwhile, S&P 500 futures and Nasdaq 100 futures teetered around the neutral point.
These developments follow an uncommon positive day on Wall Street, a rarity in the recent weeks’ landscape. Notably, the S&P 500 and the Nasdaq Composite both advanced, showcasing gains of 0.6% and 0.8%, respectively. Simultaneously, the Dow concluded with a notable rise of over 200 points, signifying an approximately 0.6% gain. The performance of 3M played a role in bolstering the blue-chip index, surging by more than 5% on the heels of reports that the conglomerate was prepared to settle lawsuits related to alleged defects in some of its earplugs.
Nevertheless, Monday’s upward movement is best seen as a temporary break from what is emerging as a challenging month for the stock market. With only three trading sessions remaining in August, the Dow is on track to conclude the month with a 2.8% decrease. Similarly, the S&P 500 and the Nasdaq are positioned for losses of 3.4% and 4.5%, respectively.
Chris Barto, an investment analyst at Fort Pitt Capital, noted, “Right now, there’s a lot of assessment taking place as we have slightly pulled back from the year-to-date highs. Traders are returning from the summer period and evaluating their portfolios while making adjustments as the month draws to a close.”
Investors will closely monitor the earnings reports from companies such as Best Buy and Nio before Tuesday’s market open. This will be followed by HP’s earnings after the market close. Additionally, data encompassing home prices, job openings, and consumer confidence is set to be released on Tuesday morning.
Opportunities are abundant in fixed income, says Newfleet’s David Albrycht
Remaining invested in fixed income would be a prudent move for investors, as suggested by David Albrycht, the Chief Investment Officer of Newfleet Asset Management.
Albrycht conveyed, “We are currently observing all-in yields that haven’t been witnessed since the time of the global financial crisis,” while speaking on CNBC’s “Closing Bell.” On Monday, there was a notable rise in short-term Treasury yields, with the 1-year note rate momentarily reaching 5.553%. This marked the highest level recorded since August 25, 2000.
“It’s an opportune moment for those not engaged in fixed income to consider dollar-cost averaging,” he remarked. “However, if your investments are in fixed income, it’s advisable to remain in that position.”
Additionally, investors with money market funds and certificates of deposit should factor in their reinvestment risk and timing, as pointed out by Albrycht. Notably, the Crane 100 Money Fund Index presently exhibits an annualized 7-day current yield of 5.15%.
“While it was a prudent decision to withdraw from bank and deposit accounts, one should contemplate the strategy of gradually investing into fixed income, particularly if the Federal Reserve can effectively navigate towards a gentler economic slowdown or a moderate recession,” he further elaborated.
-Darla Mercado
Stocks poised to see losses in August
As the trading month approaches its final three sessions, the primary indexes are poised to conclude August with declines. The current standings are as follows:
The Dow has incurred a 2.8% decline so far this month. The S&P 500 has experienced a 3.4% decrease thus far in the month. The Nasdaq Composite has recorded a 4.5% drop up to this point in the month. — Alex Harring
Stocks move after the bell following earnings reports
While the majority of the earnings season has now passed, certain stocks experienced post-market movements in response to their recent reports.
HEICO, a manufacturer of engine and aircraft parts, witnessed a decline of 5.6% in extended trading. Notably, HEICO exceeded expectations with its revenue of $723 million for the fiscal third quarter, surpassing the consensus estimate of $702 million put forth by analysts surveyed by Refinitiv.
Conversely, LifeVantage, a wellness company, recorded a 6.8% increase in after-hours trading. In its most recent quarter, the company achieved earnings of 17 cents per share, excluding exceptional items. This demonstrates significant growth from the 1 cent per share reported a year ago. Furthermore, revenue amounted to $54.2 million, which exceeded the $50.9 million recorded in the same period last year. Notably, LifeVantage also announced a one-time special dividend of 40 cents.
Meanwhile, education stock Afya saw a post-market advance of 0.6%. The company reported improved figures for adjusted net income, revenue, and EBITDA compared to the corresponding quarter of the previous year. Additionally, Afya reaffirmed its full-year guidance.
— Alex Harring
Stock futures are little changed
Around 6 p.m. ET, stock futures displayed minimal movement.
Futures linked to the Dow, S&P 500, and Nasdaq 100 were all trading in close proximity to the neutral point.
— Alex Harring
