Stocks Retreat from July Rally on Weak Earnings
The S&P 500’s recent surge to a 16-month high stalled as several companies reported disappointing earnings, leading to concerns about the sustainability of corporate profits. JetBlue, BMW, and DHL were among the firms that saw their stocks decline due to various factors, including profit forecast cuts and higher development costs.
Analysts remain cautious as they assess the impact of central bank policy tightening and mixed data on jobs openings. With the S&P 500 inching closer to an all-time high, investors are awaiting key employment figures and earnings reports from tech giants like Apple and Amazon before making further moves.
In contrast, Oppenheimer Asset Management remains optimistic about the S&P 500’s prospects, raising its year-end price target to 4,900, projecting a potential 7% advance by the end of the year.
China’s home sales and factory activity registered concerning figures, prompting calls for policymakers to address the sector’s liquidity crunch and weakened demand.
Major market moves include the S&P 500 and Nasdaq 100 declining by 0.3%, while the Stoxx Europe 600 fell by 0.9%. The dollar gained strength against other currencies, and yields on 10-year Treasuries, as well as European bonds, increased.
In the cryptocurrency market, Bitcoin and Ether experienced minor declines, while WTI crude and gold futures also dropped.
