John Hancock: Weekly Market Recap Week Ended July 24th
Earnings bump
Although they’re in sharp decline, second-quarter earnings are coming in a bit better than expected, based on results from the roughly one-quarter of S&P 500 companies that had released numbers as of Friday. FactSet projects a quarterly earnings decline of about 42%, compared with the 44% drop that it had projected a week earlier, based on companies that have already released earnings combined with projections of upcoming releases.
Homebuying comeback
The U.S. housing market is posting record month-to-month growth after falling sharply in the spring as a result of the coronavirus pandemic. Sales of existing homes jumped 21% in June, compared with the previous month, according to the National Association of Realtors. That’s the largest monthly increase since tracking of the data began in 1968.
Yields shrink
The yield of the 10-year U.S. Treasury bond fell on Thursday to the lowest level in three months, dropping to 0.58%. The recent decline in yields is a key reason why mortgage rates have been setting record lows, providing support for the housing market
GDP ahead
The U.S. government’s initial report Thursday on second-quarter GDP is likely to be the most closely watched economic release of the week. Economists’ estimates vary widely because of the uncertainty from COVID-19. In this year’s first quarter, GDP shrank by 5.0%, the worst since late 2008.
Source: https://wmr.jhinvestments.com/