
U.S. stocks faced a sharp pullback last week following weaker-than-expected hiring data and the announcement of new tariffs by the United States. The S&P 500, which had notched record highs for six straight sessions the week prior, saw its worst single-day drop since May on Friday. All major benchmark indexes closed the week in negative territory. The disappointing jobs report sparked renewed concerns over slowing economic growth and added fuel to expectations of a Federal Reserve rate cut in September. Additionally, new tariffs targeting several U.S. trade partners heightened inflation fears, further dampening stock trader sentiment. Treasury yields fell significantly, with the 10-year yield reaching its lowest level since April. Meanwhile, crude oil prices rose, although speculation around potential OPEC+ production increases may put downward pressure on prices in the weeks ahead.
Last Week’s Economic News
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The goods and services trade deficit narrowed to in June, down and from May.
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Services sector activity expanded at its fastest pace this year. The S&P Global U.S. Services PMI rose in July from June, supported by strong new business growth. However, tariffs continued to push input and output prices higher.
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The national average price for regular gasoline was $3.140 per gallon on August 4, $0.308 lower than a year ago.
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Initial jobless claims rose slightly to 226,000 for the week ended August 2. The insured unemployment rate held at 1.3%.
Eye on the Week Ahead
This week’s focus will be on inflation data, with the release of the July Consumer Price Index and Producer Price Index. June saw consumer prices increase 0.3% while producer prices were unchanged.
Have a nice week!
Sincerely,