The S&P 500 index rose 1.3% last week, led by the technology and communication services sectors. The index is now up 15% for the year to date.
Last week, the S&P 500 recorded its largest weekly increase of the year as comments by Federal Reserve Chair Jerome Powell and a weaker-than-expected October jobs report helped ease investor worries about rate policy. The relief rally continued for much of the week, with the S&P 500 achieving its eighth consecutive daily increase on Wednesday.
The daily winning streak came to a halt on Thursday as Powell warned that the central bank’s Federal Open Market Committee is “not confident” that it has achieved a stance of monetary policy that is sufficiently restrictive to bring inflation down to its 2% target over time.
“If it becomes appropriate to tighten policy further, we will not hesitate to do so,” Powell said Thursday, prompting jitters across the market.
Still, US stocks resumed their climb on Friday as investors appeared to calm their nerves and focus on corporate earnings reports.
The technology sector had the largest percentage gain of the week, up 4.8%, followed by a 2.2% increase in communication services. Other gainers included consumer discretionary, industrials and consumer staples. However, there were still five sectors in the red, led by a 3.8% drop in energy, a 2.6% decline in utilities and a 2.1% slip in real estate.
This week, the earnings calendar features a number of retailers including Home Depot (HD), TJX Cos. (TJX), Target (TGT), Walmart (WMT) and BJ’s Wholesale Club Holdings (BJ).
Economic data expected this week include key inflation readings: the October consumer price index is due on Tuesday and the October producer price index is due on Wednesday. Other reports will include October US retail sales on Wednesday, October industrial production and capacity utilization on Thursday and October housing starts on Friday.
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