John Hancock: Weekly Market Recap Week Ended August 17th
Rally time
The Dow surged 396 points on Thursday, posting its biggest daily gain in more than four months. Strong earnings results were cited as a key catalyst, along with positive developments in the recent economic turmoil in Turkey.
Shopping strength
Strong quarterly results from several major U.S. retailers helped provide a positive catalyst for stocks in the home stretch of earnings season. The industry got a further lift on Wednesday, when the government reported retail sales grew faster than expected in July.
China’s pullback
A key Chinese index dropped 4.5% for the week, declining to its lowest level since January 2016. Trade tensions have recently weighed heavily on China’s market; a sell-off in shares of a Chinese technology company triggered much of the latest week’s decline.
Climbing back
Stocks recovered from a bumpy start to the week as the S&P 500 and the Dow both rose around 1%, with the S&P 500 closing less than 1% below its record high set about seven months ago. The NASDAQ didn’t fare as well, posting a modest decline.
Policy talk
Investors will be closely watching for indications of a possible monetary policy shift when Federal Reserve Chairman Jerome Powell delivers a speech on Friday at an annual Fed symposium in Jackson Hole, Wyoming. On Wednesday, the Fed is set to release minutes from its most recent policy meeting.
Source: jhinvestments.com, John Hancock Investments