The Dow Jones Industrial Average closed at 26,485.01 on Friday with a loss of 98.41 points or -0.37%. The S&P 500 closed at 2,932.05 for a loss of 21.51 points or -0.73%. The Nasdaq Composite closed at 8,004.07 for a loss of 107.05 points or -1.32%. The VIX Volatility Index was lower at 17.61 for a loss of 0.26 points or -1.45%.
For the week, the Dow Jones was down 2.7%, the S&P 500 was down 3.0% and the Nasdaq was down 2.4%. Year to date, the Nasdaq is up 22.2%, the S&P 500 is up 17.0% and the Dow Jones is up 14.0%.
Friday’s market movers
A generally strong labor market report Friday couldn’t offset new uncertainties over international trade tariffs with China as stocks ended lower for the day. Indexes fell for five consecutive days during the Aug. 2 week as investors received several important announcements along with the Trump administration’s announcement Thursday to tax an additional $300 billion worth of Chinese imports starting Sept. 1. The U.S. economy added 164,000 jobs in July and the unemployment rate remained unchanged. Meanwhile, reports from China showed the country was potentially making plans to retaliate on tariffs.
Treasuries were lower Friday after the Federal Reserve announced a 0.25% federal funds rate cut this week along with plans to stop shrinking its balance sheet two months early. Both moves put downside pressure on fixed income yields, but investors will be looking for more long-term rate guidance after Fed sentiment showed mixed signals on more rate cuts. Many believe more rate cuts would support the strong stance on China tariffs, but the economy and labor market continue to remain healthy with inflation the main concern at a low 1.4% annually.
On the earnings calendar, second-quarter earnings continued. The following companies made earnings headlines Friday:
- Exxon Mobil (XOM, Financial): Beat revenue estimates. Beat earnings per share by 1 cent.
- Chevron (CVX, Financial): Missed revenue estimates. Beat earnings estimates by 44 cents.
- Moneygram (MGI, Financial): Beat earnings estimates by 4 cents. Stock gained 6.51%.
Economic reports affecting market trading included the following:
- The Bureau of Labor Statistics’ Employment Situation report showed nonfarm payrolls increasing 164,000 in July, in line with estimates and slightly below June’s increase of 193,000. The unemployment rate remained unchanged at 3.7%.
- Other details in the Employment Situation report showed average hourly earnings increasing 0.3% in July and 3.2% year over year, average weekly hours at 34.3, nonfarm private payrolls increasing 148,000, government payrolls increasing 16,000, manufacturing payrolls increasing 16,000 and the participation rate at 63%.
- The International Trade in Goods and Services report showed a balance of trade deficit of $55.2 billion in June. Separately, imports were $261.5 billion and exports were $206.3 billion.
- The Michigan Consumer Sentiment Index increased to 98.4 from 98.2.
- Factory orders increased 0.6% in June following a decrease of 1.3%. Factory orders excluding transportation increased 0.1%.
- The Baker Hughes North American oil rig count increased to 1,079 from 1,073.
- Total vehicle sales decreased to a seasonally adjusted annual rate of 16.8 million in July, down from 17.1 million and in line with consensus of 16.9 million.
In the S&P 500, technology, energy and materials led losses. In the Dow Jones Industrial Average, the following stocks led losses:
- Cisco (CSCO, Financial) -3.94
- Dow (DOW, Financial) -2.84%
- Apple (AAPL, Financial) -2.46%
- Nike (NKE, Financial) -2.36%
- IBM (IBM, Financial) -2.14%
Small-cap stocks
In small caps, the Russell 2000 closed at 1,533.66 for a loss of 17.11 points or -1.10%. The S&P 600 closed at 938.14 for a loss of 10.10 points or -1.07%. The Dow Jones U.S. Small-Cap Growth Index closed at 9,892.97 for a loss of 121.64 points or -1.21%. The Dow Jones U.S. Small-Cap Value Index closed at 9,312.11 for a loss of 77.99 points or -0.83%.
Other notable indexes
Other notable index closes included the S&P 400 Mid-Cap Index at 1,914.53 for a loss of 18.95 points or -0.98%; the S&P 100 at 1,296.65 for a loss of 9.01 points or -0.69%; the Nasdaq 100 at 7,692.80 for a loss of 108.35 points or -1.39%; the Russell 3000 at 1,723.31 for a loss of 14.18 points or -0.82%; the Russell 1000 at 1,623.84 for a loss of 13.03 points or -0.80%; the Wilshire 5000 at 30,052.48 for a loss of 239.71 points or -0.79%; and the Dow Jones U.S. Select Dividend Index at 704.92 for a loss of 3.35 points or -0.47%.
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
