John Hancock: Weekly Market Recap Week Ended July 26th

Earnings ramp up

Quarterly earnings season is entering its busiest week, and the vast majority of companies that have reported results so far exceeded analysts’ expectations. Among S&P 500 companies that had released second-quarter numbers as of Friday, 77% had topped forecasts, exceeding the average earnings beat rate of the past five years, according to FactSet.

Euro easing

The European Central Bank signaled its intention to cut short-term interest rates and possibly restart its bond-buying program. If the bank follows through with a rate reduction, it would be Europe’s first such cut since early 2016.

Tech-driven gains

After a modest setback the previous week, the major stock indexes regained their recent upward momentum, with the NASDAQ and S&P 500 climbing around 2% and outperforming the Dow by wide margins. Strong earnings results from key information technology and communication services companies lifted the broader market.

Changing course

The U.S. Federal Reserve is widely expected to cut interest rates for the first time in about a decade when it concludes a two-day meeting on Wednesday. Most observers expect the Fed will approve a cut of a quarter of a percentage point in hopes of maintaining solid U.S. economic growth in the face of a potential global slowdown.

Source: https://wmr.jhinvestments.com/