All 3 major indexes were up for the week ended 8/30/19. The Dow Jones Industrial average ended the week at 26,403 an increase of 3.0%. The broader S&P 500 index ended the week at 2,926 an increase of 2.8%. The Nasdaq 100 ended the week at 7,691 an increase of 3.0%. The average change for the major averages was up 2.95%.
All of the major indexes are up year to date with the Dow rising 3.3%, the S&P 500 is up 3.2% and the Nasdaq 100 by 3.6%.
The markets were very much influenced by 'trade war' news (or maybe non-news). President Trump indicated that the Chinese were ready to come back to the negotiating table and want to make a deal. Trump detractors have stated that the Chinese never contacted the Trump administration. Either way, it was a positive for the markets so the whip-saw reactions to any trade and tariff news was met with a quick reaction.
There was quite a bit more activity in the treasury sector with the yield curves inverting and dropping significantly this week. There was some concern (declining stock prices) with this, but this was not the overarching catalyst in the markets this week.
Investment Style View
If you are a dividend investor, dividend stocks increased in the last week by 2.3%, with the iShares Dividend price climbing from $95.77 to $97.95.
In the latest week, large cap stocks outpaced both small cap and mid cap stocks. Large cap stocks increased by 3.6% for the week while mid-cap stocks increased by 3.1% and small-cap stocks increased by 2.9%. In order for us to monitor the performance difference between growth and value stocks, we look at the different capitalization levels (large, mid and small cap). In the latest week, there was a mixture in performance between growth and value stocks based on the capitalization of the underlying companies. Large-cap growth stocks outperformed large-cap value stocks this week 3.0% vs. 2.5%. Mid-cap growth stocks outperformed Mid-cap value stocks this week 1.9% vs. 1.6%. Small-cap value stocks outperformed Small-cap growth stocks this week 2.8% vs. 2.3%.
All 11 sectors rose last week along with the major indexes. The best performing sector last week was the Industrials sector, which ended the week up by 3.7%. The financial sector performed well last week, increasing by 2.8%. Consumer Staples was the underperformer for the week increasing by 1.60%, just behind the Real Estate Sector, which ended the week up by 1.66%.
There were some earnings releases last week with a couple more important retail stocks reporting this week.
- Best Buy Co. (BBY) announced earnings after the market close on 8/29. Earnings came in at $1.08 the analyst consensus was $0.99, a difference of $0.09 per share. Shares closed the prior day at $69.00 a share and closed the day at $63.49 a decline of 8.0%.
- Campbell Soup (CPB) announced earnings after the market close on 8/30. Earnings came in at $0.42 the analyst consensus was $0.41, a difference of $0.01 per share. Shares closed the prior day at $43.31 a share and closed the day at $45.00 an increase of 3.9%.
- Dollar General (DG) announced earnings after the market close on 8/29. Earnings came in at $1.74 the analyst consensus was $1.58, a difference of $0.16 per share. Shares closed the prior day at $141.03 a share and closed the day at $156.09 an increase of 10.7%.
- Ulta Beauty Inc (ULTA) announced earnings after the market close on 8/29. Earnings came in at $2.76 the analyst consensus was $2.79, a difference of $-0.03 per share. Shares closed the prior day at $337.45 a share and closed the day at $237.73 a decline of 29.6%.
The Week Ahead
We've got a long holiday weekend this week to let ourselves get ready for everyone to be back at school and for vacation season to be over and done with. Even the Canadian financial markets are closed on Monday.
We've got a few data releases coming this week with the Census Bureau reporting on construction spending for July on Tuesday. It's estimated that spending will have incresed by 0.3% after the 1.3% decline in June. The trade deficit will be reported by the Census Bureau on Wednesday for the month of July. It's expected that the deficit will be $53.5 Billion after June's $55.2 Billion deficit - we will see what the impact has been from the tariffs.
Employment figures will be reported with preliminary August figures being released first by ADP on Thursday and then by the BLS on Friday. This report is going to be watched closely to see what, if any impact there has been from the trade dispute with China as many are looking for evidence of a potential economic slowdown, which could surface in these numbers first.
Authors Note: No stocks discussed in this article are currently owned by the writer.
About the Writer
This page was created and is maintained by Kurt Tietjen, Founder of Stavera, High Peak Media & HomeGearWorks.com. Kurt is an executive, data scientist and software engineer who holds an MBA in Management Information Systems. In 2010, he partnered with scientists at Northwestern University to launch The Street Wire. This was one of the first mainstream uses of what would become “Narrative Science”, an artificial intelligence platform specializing in natural language generation. You can contact Kurt on LinkedIn here.