Dow, S&P close records as Disney offsets weaker sentiment
By Chuck Mikolajczak
NEW YORK (Reuters) – The Dow Industrial and S&P 500 hit closing highs on Friday and posted a second straight week of gains, supported by a rise in Walt Disney shares, but a sharp drop in consumer confidence limited earnings.
Walt Disney rose 1.00%, one of the biggest increases in the Dow Jones and S&P benchmarks after its profits beat market expectations as its streaming services added more more customers than expected and its pandemic-affected US theme parks have returned to profitability.
But a report from the University of Michigan shattered optimism after showing the university’s consumer confidence index fell to 70.2, its lowest level in a decade, suggesting that the Delta variant of the coronavirus was having an impact on consumers.
“It’s concerning, the consumer is obviously in an extremely strong position, but there’s this kind of COVID fatigue that is really starting to weigh on people’s sentiment,” said Ross Mayfield, investment strategist at Baird in Louisville, Kentucky.
“Regardless of foreclosure or full reopening, the consumer is healthy enough to spend and sort of keep the economy afloat, different names and different sectors will benefit from it. “
The report lowered the yield on the 10-year US Treasury bill and in turn helped push mega-cap stocks, such as Microsoft Corp, up 1.05%, while the retail giant Amazon online retail slipped 0.29%.
The Dow Jones Industrial Average rose 15.53 points, or 0.04%, to 35,515.38, the S&P 500 gained 7.17 points, or 0.16%, to 4,468 and the Nasdaq Composite added 6.64 points, or 0.04%, to 14,822.90.
Over the week, the Dow Jones gained 0.87%, the S&P 500 rose 0.71% and the Nasdaq slipped 0.09%.
U.S. stocks have managed to slowly reach new highs in recent sessions as investor confidence in the economic recovery has been bolstered by a strong earnings season, the passage of a major infrastructure and infrastructure bill. data showing that inflation could increase at a slower rate than expected.
Following new data earlier this week that showed consumer price increases slowed in July, while producer prices posted their biggest annual increase in more than a decade, investors are now eagerly awaiting the central bankers meeting in Jackson Hole, Wyoming, later this month for clues about the policy.
In recent days, several Fed officials have said it is almost time for the central bank to start withdrawing monetary support, including reducing its asset purchases.
DoorDash Inc was up 3.50% in choppy trading after the loss of the food delivery business widened more than expected in the second quarter.
Airbnb Inc gained 1.07% as it recovered from previous declines, after reporting a blow to its current quarter bookings by the Delta variant and a slowdown in the pace of vaccination in the United States.
Volume on the U.S. exchanges was 7.99 billion shares, compared to 9.42 billion on average for the full session over the past 20 trading days.
The S&P 500 posted 60 new 52-week highs and no new lows; the Nasdaq Composite recorded 87 new highs and 159 new lows.
(Reporting by Chuck Mikolajczak; Editing by Aurora Ellis)