S&P 500 Eyes 6th Straight Win, But Investor Sentiment Remains Cautious Ahead Of Data Deluge, Walmart Earnings And Other Key Events

U.S. stocks are on track for a modestly higher start on Thursday, with the S&P 500 looking to extend the winning streak to six sessions. The ultimate trading direction of the day could hinge on a slew of key data, due for the day, pertaining to the job market, consumer spending and manufacturing activity as well as retail earnings. Most of these have relevance for growth at a time when pricing pressure has eased.

Fund manager Louis Navellier said the July retail sales report along with Walmart, Inc. WMT should offer clues regarding the health of the consumer. These catalysts are all the more important, given concerns expressed by companies over the health of consumers on their earnings calls as well as the higher credit card balances and rising delinquency rates. Walmart shares rose over 6% in premarket following its quarterly beat and an upward revision to full-year guidance.

Futures	Performance (+/-)
Nasdaq 100	+0.07%
S&P 500	+0.04%
Dow	+0.18%
R2K	-0.5%

Cues From Last Session:

Wall Street closed Wednesday’s session higher, although trading sentiment remained lackluster for much of the day following the July consumer price inflation that came in line with expectations. Alphabet, Inc. GOOGL GOOG led communication services stocks lower amid rumors that the Department of Justice is contemplating a break-up of the search giant amid anti-trust concerns.

The major averages opened higher but turned lower immediately after, but the Dow Industrials and the S&P 500 Index recovered and traded mostly higher for the remainder of the session. The tech-heavy Nasdaq Composite was confined in negative territory for the bulk of the session and yet ended marginally higher.

All three averages are now at their highest levels in about two weeks.

Index	Performance (+/)	Value
Nasdaq Composite	+0.03%	17,192.60
S&P 500 Index	+0.38%	5,455.21
Dow Industrials	+0.61%	40,008.39
Russell 2000	+0.52%	2,084.32

Insights From Analysts:

The recent equity market pullback should not be a deterrent for investors, according to a market strategist. “Despite the negative market action, we don't believe that there's a reason for equity investors to exercise significant caution,” said Eric Freedman, chief investment officer for U.S. Bank Wealth Management, in a note released on Aug. 8.

“We still think it's a great time to be invested and for those with money in cash, it represents an opportunity to put capital to work in longer-term assets,” he said.

Navellier said in a note to clients that he expects the market recovery to continue, as any weakness in economic data only increases the odds of a more aggressive Fed-cutting cycle. 

Upcoming Economic Data:

• The Commerce Department will release the July retail sales report at 8:30 a.m. EDT, with economists, on average, estimating a 0.3% month-over-month increase in the headline number, following stagnant sales in the previous month. The growth in retail sales, excluding autos, may have decelerated from 0.4% to 0.1%.
• The Labor Department is scheduled to release the weekly jobless claims report at 8:30 a.m. EDT. The consensus estimate calls for the number of individuals claiming unemployment benefits to come in at 235,000 units for the week ended Aug. 10, up slightly from 233,000 in the previous week. The Labor Department will also release the import and export prices report for July around the same time.
• The New York Fed and the Philadelphia Fed will release the results of their separate regional manufacturing surveys for August at 8:30 a.m. EDT. The business conditions index based on the New York Fed’s survey is expected to remain in contraction territory at -6 compared to -6.6 in July. The Philadelphia Fed’s diffusion index of business activity is expected to come in at 7.9 for August, down from 13.9 in July.
• St. Louis Fed President Alberto Musalem is due to make a public appearance at 9:10 a.m. EDT.
• The Federal Reserve is scheduled to release the industrial production report for July at 9:15 a.m. EDT. Economists, on average, expect a 0.1% month-over-month dip in output, reversing some of the 0.6% increase in June.
• Philadelphia Fed President Patrick Harker is due to speak at 1:10 p.m. EDT.

See also: Best Futures Trading Software

Stocks In Focus:

• Cisco Systems, Inc. CSCO rose over 6% in premarket trading following the release of the networking giant’s quarterly results, and Lumentum Holdings Inc. LITE soared over 16%, also in reaction to its quarterly results.
• Alibaba Group Holding Limited BABA, JD.com, Inc. JD, Walmart and Deere & Company DE are among the notable companies reporting earnings ahead of the market open.
• Those reporting after the close are Applied Materials, Inc. MAT, Coherent Corp. COHR and H&R Block, Inc. HRB.
• Sirius XM Holdings Inc. SIRI and Ulta Beauty, Inc. ULTA jumped over 13% and 15%, respectively, after Warren Buffett’s Berkshire Hathaway, Inc. BRK (BRK-B) stake disclosures.
• Nike, Inc. NKE rose over 4% after Bill Ackman’s Pershing Square initiated a position in the company.

Commodities, Bonds And Global Equity Markets:

Crude oil and gold futures rebounded after Wednesday’s slide, with the latter trading under $2,500-an-ounce level. The 10-year Treasury note yield rose 1.7 points to 3.839%. Bitcoin BTC/USD pulled back by over 4% over the past 24 hours, falling back toward the $54,000 level.

The Asian markets that remained open for trading closed mostly higher on Thursday, although the Indonesian, Taiwanese and Hong Kong markets saw modest weakness. The South Korean and Indian markets were closed for public holidays. The Japanese market benefited from a strong growth rebound by the economy in the second quarter, while the Chinese market drew encouragement from a slew of weak data that heightened expectations for stimulus.

European stocks held up in early trading.

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