Wall Street's major indexes lost ground over the past week as traders fretted over US economic growth and turned their attention to the coming week's updates on personal spending and the job market.
In the week to Friday, the blue-chip Dow Jones Industrial Average fell 0.86 percent to 11,284.05, while the technology-packed NASDAQ market closed down 1.09 percent on the week at 2,140.29.
The broad-market Standard & Poor's 500 declined 0.55 percent to 1,295.09.
The market's lackluster performance came amid slow summer trade, but as debate mounted over whether the vast US economy is headed for a soft or a hard landing following a long string of interest-rate hikes.
Fed policy-makers, however, put a brake on their rate hikes on Aug. 8, opting to keep the fed funds rate pegged at 5.25 percent.
"The economy is clearly slowing. What happens next probably depends on the Fed," observed Philip Orlando, an analyst at Federated Securities.
"At the moment, our biggest concern is the consumer, who is being pinched by rising energy prices and interest rates," Orlando said.
Wall Street will get a fresh insight into consumer attitudes on Tuesday when the Conference Board releases its consumer confidence index reading for this month.
Most economists expect the index, which tracks consumer attitudes, to moderate to 103.7 from July's 106.5 reading.
Economists track consumer attitudes closely because consumer spending accounts for some two-thirds of US economic growth.
"The market will be interested to see if the weakness in housing has a kind of effect on consumers, if they cut back their spending. That is what Wall Street is focused on," said Mace Blicksilver, an analyst at Marblehead Asset Management.
Further light might also be shone on the Fed's position on Tuesday when the central bank is due to release the minutes of the Aug. 8 rate meeting.
The rest of the week will yield updates on consumer spending, auto sales and nonfarm payrolls employment, although Wall Street trading is not expected to be heavy as many traders are taking annual holiday leave.
Consumer spending is expected to rise to 0.8 percent in July from a 0.4 percent gain registered in June.
The government's nonfarm payrolls report, due for release Friday, is expected to show nonfarm job growth rose to 125,000 this month, from a hiring pace of 113,000 in the prior month, according to a consensus forecast.
Despite the projected rise, such a clip in August would still be sub-par for the US economy.
Auto sales will also be watched closely, especially as Japanese car giant Toyota overtook Ford last month as the US' second-largest automaker behind General Motors.
Overall car sales for August are expected to moderate to 5.4 million cars, compared with 5.6 million in July.
Bond prices strengthened over the week.
The yield on the 10-year Treasury bond dropped to 4.791 percent from 4.835 percent a week earlier, while that on the 30-year bond fell to 4.932 percent from 4.973 percent. Bond yields and prices move in opposite directions.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by