What happened last week…
The S&P 500 achieved new record highs during the week as all three major indices finished higher in the month of August: DJIA (3.20%), S&P 500 (1.91%), NASDAQ (1.58%). Both the DJIA and the S&P 500 have recorded four consecutive months in positive territory while NASDAQ has made gains for five months in a row. Year-to-date performances are as follows: DJIA (7.05%), S&P 500 (9.84%), NASDAQ (11.11%).
Apple (AAPL) has reportedly held internal discussions about acquiring artificial intelligence startups Mistral and Perplexity. Apple typically keeps the dollar amount of its acquisitions relatively small, and such a deal for either AI startup would be of considerable value, so it is possible no deal will materialize. The company will hold its annual Apple Event on September 9.
The GDP growth rate (second estimate) for Q2 2025 beat expectations (3.1%) as it increased to 3.3%, compared to the first estimate of 3.0%. The estimate is higher than the Q1 2025 reading.
New home sales for July beat expectations (630,000) as it reached 652,000.
According to FactSet, as of August 29, for Q2 2025, 98% of S&P 500 companies reported earnings with 81% having a positive EPS surprise and 81% having a positive revenue surprise. The blended earnings growth for the S&P 500 is 11.9%, which would be the third straight quarter of double-digit growth. The blended revenue growth for the index is 6.4%, which would be the highest growth rate since Q3 2022 (11.0%).
Happening this week…
On Tuesday, the manufacturing PMI for August is expected to increase to 48.6 from 48.0. On Thursday, the non-manufacturing PMI for August is expected to increase to 50.5 from 50.1.
On Wednesday, the ADP employment change may be 72,000. On Friday, the unemployment rate is expected to be 4.3%, nonfarm payrolls are forecasted to increase to 78,000 from 73,000, and average hourly earnings month-over-month are expected to remain at 0.3%.
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The Rockline Team
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