Here are the key news, trends, and analysis investors need to start their trading day:
1. Stocks open lower but July is still looking for profits
Trader on the New York Stock Exchange, July 20, 2021.
Wall Street will open lower on the last day of trading in July as investors digest three Dow stock earnings reports and another measurement of inflation. Nasdaq futures were at the top, down more than 1% on Friday, as Amazon stock fell nearly 7% after its first drop in sales in the premarket in three years. The Dow Jones Industrial Average and S&P 500 hit all-time highs during Thursday’s trading, breaking two-day losing streaks. But they couldn’t beat Monday’s record deals. The Nasdaq rose modestly but closed about 0.4% off its most recent record high on Monday. All three stock benchmarks tracked solid monthly returns.
2. The Fed’s most popular inflation meter is slightly below estimates
A child walks past the Marriner S. Eccles Federal Reserve Board building on Constitution Avenue, NW, Monday, April 26, 2021.
Tom Williams | CQ Roll Call, Inc. | Getty Images
The Federal Reserve’s most popular inflation meter was slightly below expectations for June. The Department of Commerce’s most recent core consumer spending index rose 3.5% year-over-year, slightly above the May surge, which was the fastest pace since the early 1990s. At the close of its July meeting on Wednesday, the Fed noted “progress” on inflation and employment targets, which was seen as a signal that a change in easy money policy, particularly monthly bond purchases, might be imminent. Central bankers made no adjustments to asset purchases and interest rates close to zero.
3. Mixed stock reactions to the profits of Dow companies
On July 12, 2021 in San Francisco, California, Chevron and Shell gas stations display gasoline prices close to $ 5.00 per gallon.
Justin Sullivan | Getty Images
Dow stock Chevron just reported a second profitable quarter in a row as improved demand for petroleum products and a surge in oil prices fueled operations. The company has also resumed its share buyback program. The oil giant made an adjusted $ 1.71 per share on revenue of $ 37.6 billion, which beat both estimates. Before the IPO, the shares rose by around 1.5%. Exxon, no longer a Dow stock, also beat estimates for earnings and sales. The shares rose in the premarket.
Caterpillar Inc. excavators will be available for sale at the Whayne Supply Co. dealer in Louisville, Kentucky, USA on Monday, January 27, 2020.
Luke Sharrett | Bloomberg | Getty Images
Caterpillar, another Dow component, lost nearly 2.5% in the premarket on Friday, despite the heavy equipment maker saying it made an adjusted $ 2.60 per share on sales of nearly $ 12.9 billion have. The industrial group is benefiting from higher infrastructure spending around the globe.
Bottles of Tide laundry detergent, a Procter & Gamble product, will go on sale at a pharmacy in Los Angeles, California on July 30, 2020.
Mario Tama | Getty Images
Procter & Gamble beat estimates on Friday with quarterly earnings and revenues as consumers bought more premium health and personal care products. Dow shares rose 1% before the IPO. P&G reported earnings per share of $ 1.13 on sales of nearly $ 19 billion. However, the company warned that rising raw material costs could hurt earnings in the coming year.
4. Amazon posts another $ 100 billion quarter but still misses
Crates move on a conveyor belt at an Amazon fulfillment center on Prime Day in Raleigh, North Carolina, the United States, on Monday, June 21, 2021.
Rachel Jessen | Bloomberg | Getty Images
According to Amazon, revenue in the second quarter rose 27% year over year to more than $ 113 billion, the third straight quarter of $ 100 billion, but actually slower growth compared to the blistering 41% increase in the same period last year . The e-commerce and cloud giant reported earnings per share of $ 15.12 for the second quarter, beating expectations. Looking ahead, Amazon warned of lower sales and a lower growth rate for the third quarter. The forecast reflected similar warnings from Facebook and Apple this week that sales growth rates would slow from pandemic highs.
5. CDC is expected to publish data on new mask recommendations
U.S. President Joe Biden and Vice President Kamala Harris will receive an update on the fight against the coronavirus disease (COVID-19) pandemic during their visit to the Centers for Disease Control and Prevention (CDC) in Atlanta, Georgia on March 19, 2021.
Carlos Barria | Reuters
Unpublished CDC data, which formed the basis of the decision to re-recommend wearing masks indoors to fully vaccinated people in locations with high Covid transmission rates, is expected to be released on Friday, according to The Washington Post. The internal CDC document that the Post received shows that the Delta variant is as contagious as chickenpox. It also shows that vaccinated people who become infected with Delta can spread it just as easily as unvaccinated people. Members of Congress were briefed on the CDC data by director Rochelle Walensky on Thursday, the Post reported.
– Reuters contributed to this report. Follow the whole market like a pro on CNBC Pro. Get the latest on the pandemic with coronavirus coverage from CNBC.