John Hancock: Weekly Market Recap Week Ended August 30

August by the numbers

After a rough initial week, the S&P 500 recovered to finish August with a gain of more than 2% as the index posted its ninth positive month out of the past ten. The Dow added nearly 2% while the NASDAQ finished almost 1% higher. It was a big change from August 5, when the NASDAQ had briefly been down as much as 10.7% from its July 31 closing level.

Inflation slowdown

The U.S. Federal Reserve’s preferred inflation gauge on Friday showed a slow-but-steady easing of price pressures ahead of a September 17–18 Fed meeting that’s expected to produce the first rate cut in more than four years. Excluding energy and food prices, the Personal Consumption Expenditures Index rose at an annual rate of 2.6% in July, slightly below economists’ consensus forecast of 2.7%.

Improving sentiment

An indicator that tracks U.S. consumer sentiment rose for the first time in five months. Friday’s 67.9 reading from the University of Michigan’s Consumer Sentiment Index was up slightly from a preliminary August estimate of 67.8. Consumers’ expectations of inflation over the next year remained at their lowest level since December 2020.

Jobs report ahead

A monthly employment report scheduled to be released on Friday will show how August’s jobs growth compared with July’s gain of 114,000 jobs. That result marked the second consecutive month of declining jobs growth, and July’s unemployment rate of 4.3% was the highest in nearly three years.

Source:  https://www.jhinvestments.com