The S&P 500 index rose 1.0% last week, led by the communication services sector, amid stronger-than-expected Q2 earnings while US economic growth for Q2 also surpassed expectations.
With just one session left in the month, the S&P 500 is now up 3% for July. It is up 19% for the year to date.
The week’s advance was limited by concerns about future rate policy as the Federal Reserve’s Federal Open Market Committee raised its key rate. The boost, while just a quarter of a percentage point, follows a pause in rate increases last month and led to more questions on what may be ahead for the Fed’s policy.
The S&P 500 still ended the week in positive territory as many companies posted stronger-than-expected Q2 results and US gross domestic product grew 2.4% in Q2, surpassing economists’ estimate for a 1.5% expansion. This represents stronger growth than Q1’s 2% expansion.
Communication services had the sharpest weekly increase, up 6.8%, followed by a 1.8% increase in materials and a 1.7% rise in energy. Other sectors that gained included technology, consumer discretionary, consumer staples and industrials.
The gainers in communication services were led by Facebook parent Meta Platforms (META) and Google parent Alphabet (GOOGL), which jumped 11% each.
This week’s earnings calendar features Merck (MRK), Pfizer (PFE), Advanced Micro Devices (AMD), Caterpillar (CAT), Starbucks (SBUX), Apple (AAPL), Amazon.com (AMZN), and more.
Among economic reports, the Labor Department’s July employment data are likely to receive the most attention. Other reports expected in the week include the Institute for Supply Management’s latest readings on the manufacturing and services sectors.
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