Market Wrap – July 29

Economic Data: U.S. Q2 GDP accelerated to 6.5% lower than expected 8.4%, but better than pre-pandemic level and investors seemed to have shrugged off as market moved up. GDP falling short is attributed to supply-chain constrains, labor demand and drop in inventories, according to analysts.

Employment: Initial Jobless claims lowered to 400K from 419K but higher than expected 384.5. Continued jobless claim moved up 3.269M from 3.236M also higher than expected 3.183M.

Market Activity: All of the main American stock indices were up, with the S&P 500 and DJIA touching records. Amazon fell in extended trading after its sales forecast fell short, pulling futures in the Nasdaq and S&P lower as of 6pm.

1. FB fell about 5% despite topping estimates but warned of slower growth ahead. All major indices are up through out the day.
2. Robinhood (ticker: HOOD) dipped 10% below its IPO price of $38 on it debut. At the company’s $38 opening price, Robinhood has a $32 billion valuation. HOOD debut added its founders Vlad Tenev and Baiju Bhatt to the list of new billionairs.
3. AMZN lost more than 7% after hours after it’s earning report of missing revenue estimates about $2 billions ($113.08 actual vs $115.2 expected), although it beats its bottom line (EPS) by $2.82 ($15.12 actual vs $12.3 expected). Amazon expects to book sales between $106 billion and $112 billion, growth of 10% to 16% compared to the same period last year, but well below consensus estimates of $119.2 billion. AMZN’s weaker guidance pushed the stock down of about $260 ($290 in total for the day as of 6pm).
4. Federal prosecutors accused Nikola founder fand former CEO Trevor Milton of misleading investors about the capabilities and technologies of the electric vehicle start-up and pressed fraud charger. He pled not guilty and was freed on $100 million bond. NKLA lost about 16% today.

Notable Events: Federal workers will be required to prove their coronavirus vaccination status or submit to a series of rigorous safety protocols, President Joe Biden announced.

The GOP is urging the Securities and Exchange Commission to enforce Chinese company transparency requirements.