Last Week’s Highlights:

Even with continued recession concerns and falling bond yields, investor enthusiasm returned last week as China’s request for “calm” in the ongoing trade war resulted in ebullient equity markets. For the week, the Dow Jones Industrial Average (DJIA) rallied 774.38 points, or 3.0%, to 26,403.28, while the S&P 500 rose 2.8% to 2926.46. The tech-heavy NASDAQ gained 2.7%, closing at 7962.88. As summer comes to an end, we’re reminded of the old Wall Street adage to “sell in May and go away,” meaning that many June through August stretches have led to flat or down stock market movements. Those investors who followed these words this past summer may have left some market returns on the table this year. The S&P 500 rose 3.5% from Memorial Day through the end of August – the fourth straight year when the index has risen during the summer vacation season.

Looking Ahead:

Stock and bond markets in the U.S. and Canada are closed Monday in observance of Labor Day. On Tuesday, Coupa Software (COUP) reports earnings for the second quarter of fiscal 2020. The Census Bureau reports construction spending data for July – economists forecast a 0.3% gain to a seasonally adjusted annual rate of $1.29 trillion, after a 1.3% decline in June. Wednesday brings more financial results with earnings releases from American Eagle Outfitters (AEO), Navistar International (NAV), Slack Technologies (WORK) and Palo Alto Networks (PANW). The Bank of Canada announces its interest rate decision – the futures market predicts a small chance that the central bank will lower its key short-term rate to 1.5% from the current 1.75%. On Thursday, Lululemon Athletica (LULU), and Guidewire Software (GWRE) report earnings. The NFL’s 100th season kicks off with the Chicago Bears hosting the Green Bay Packers at Soldier Field. The BLS releases the employment report for August on Friday – economists call for a gain of 157,000 in nonfarm hires, with the unemployment rate unchanged at 3.7%.

The Tufton Capital Team wishes you and your families a very happy Labor Day!