London’s FTSE100 ended the week flat on 6 th August after gold prices dragged the mining sector down but corporate earnings capped the losses. On Monday, the index suffered as fund supermarket Hargreaves Lansdown dropping by 11.3% although it eventually rose 0.4% due to consumer staples and healthcare to attain a one-month high of 7,161.04 points. Flutter Entertainment gained over 7%, while investment manager M&G dropped by 3.1%. On Wednesday, with the British Pound rising by 0.15%, the FTSE100 had its fourth consecutive rise and finished at 7,220.14 points being the highest since February 2020. Avast was a top gainer, up by 3.1% after NortonLifeLock Inc. agreed to buy the company for $8.6b. The index retreated red below 7,200 on Thursday throughout the session; but recorded its longest weekly winning streak since November on Friday, closing 0.4% higher, led by healthcare.
The FTSE100 mired -0.37% in red on Monday after disappointing US and Chinese economic data including Burberry falling -2.62%, Glencore by -1.54% and Anglo-American by -1.83%. On Tuesday, Miner BHP Group gained 3.1% to the FTSE100 top after declaring record annual profits and further announced an exit from the FTSE100 index and its $13b petroleum business. This prompted the London Stock Exchange to seek new listings as UK exits the EU. London's FTSE100 fell on Wednesday due to energy and financial stocks, although cooling inflation helped cut losses. British inflation fell to the central bank's 2% target in July in an unexpectedly sharp slowdown that economists consider a glitch, as an economy reopening post-lockdown drives prices higher. However, inflation is still higher than February’s 0.4% level. The FTSE100 has gained nearly 11% this year but has been stuck near the 7,100 level since May, possibly
due to the chances of higher inflation and concerns over global COVID spikes.
Share prices plunged on 9th August as sharp falls in oil and gold prices, and concerns over the Delta variant gained sentiment. S&P500 closed flat, as investors weighed drops in energy against gains in financials. On Tuesday, the index logged a record close as the Senate passed $1 trillion infrastructure bills which earmarked $550b expenditure in new areas including transportation and the electric grid. The index rose 0.3% to an all-time closing high of 4,447.60 on Wednesday with optimism that further spending on the economy would support stocks as early inflation signs appear. On Thursday, S&P500 headed for another record close as Mega- cap tech stocks kept the sector above the flatline despite sharp falls in chip giants Intel and Micron Technology. The week ended with S&P500 gaining over 0.2%.
U.S. stocks opened lower on 16th as rising Covid cases stunted the global economic recovery. However, S&P500 was supported by strong quarterly earnings, with 87% of its companies reporting positive earnings. This was the highest recorded percentage of this metric according to FactSet. With Monday’s trading at 4,479.71, S&P500 had doubled on a closing basis from its Covid trough of 2,237.40 on March 23rd. On average, this would take more than 1000 trading days to reach, but the market took only 354 trading days, marking the fastest bull market doubling off a bottom since WWII, according to a CNBC analysis.
The release of key retail sales data and quarterly earnings from Walmart and Home Depot adversely affected the US indices. July’s retail sales fell 1.1% while core retail sales fell 0.4%, both figures undershooting expectations and casting doubt on the economy’s momentum during the pandemic. The damage was partly offset by industrial production rising slightly more than expected. Overall, the S&P 500 index fell by 0.71% on Tuesday.
Written By: Sanjana Panicker
Edited By: Kabir Chadha