If you sold in May and went away, well, you’ve missed out on nearly 8% in gains for the S&P 500 SPX, +0.22%. Changing prices has a way of changing minds — Wells Fargo this week hiked its year-end S&P 500 price target by 25%.
Even a noted bear seems to have thrown in the towel.
If you looked at economic indicators, you’d be puzzled by the continued advance through the summer — U.S. economic growth has more or less plateaued as the delta variant wrecks reopening plans and supply chain woes limit production. The news from the world’s number-two economy, China, has, if anything, been worse. But the earnings picture tells a different story, of companies using the pandemic to become more productive and also deftly managing around the supply disruptions.
“Maybe 4,500 is finally far enough. Or maybe 4,600 is just around the corner. Either way, we will know the answer soon enough. Until then, continue giving this unstoppable bull market the benefit of the doubt by moving our stops up and continuing to hold,” said Jani Ziedins of the Cracked Market blog.
It’s feeling a bit like one-way traffic ahead of Federal Reserve Chair Jerome Powell’s Jackson Hole address on Friday. “Asset prices could move on Powell’s speech even if it is close to expectations,” said Steve Englander, global head of G10 FX research and North American macro strategy at Standard Chartered. “If Asia COVID concerns continue to recede and Powell does not shock on the hawkish side, a risk-positive market move could occur absent any surprise,” he says.
The buzz
The economics calendar includes the latest reading on jobless claims, and the revision to second-quarter gross domestic product, which economists expect to be upgraded from the initial 6.5% print. The Bank of Korea overnight became the first major central bank in Asia to start withdrawing stimulus with a quarter-point hike.
Salesforce.com CRM, +0.46% hiked its earnings and sales forecast as the customer-relationship management software company highlighted its margin and revenue growth. Williams-Sonoma WSM, +0.70% jumped in after-hours trade on a record earnings report for the home-furnishings retailer and a 20% boost in its dividend. Snowflake SNOW, +0.85% may gain ground after the database software company raised guidance for a second time this year. Autodesk ADSK, +0.35% fell after the architecture software maker’s guidance fell short of analyst estimates.
Dollar General DG, +0.85% is among the companies reporting results today, with a big tech result slate after the close including HP HPQ, +1.70%, Dell Technologies DELL, +1.31%, Peloton Interactive PTON, +2.23%, VMWare VMW, +1.01% and Workday WDAY, +0.12%.
Western Digital WDC, +7.80% is in advanced talks to merge with Japan’s Kioxia Holdings, The Wall Street Journal reported.
The European Union is meeting on Thursday to decide whether to reintroduce travel restrictions on U.S. visitors.
The markets
U.S. stock futures ES00, -0.08% NQ00, -0.18% were steady. The yield on the 10-year Treasury TMUBMUSD10Y, 1.340% rose to 1.35%.
Random reads
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