US stocks trade mixed as traders weigh strong mega-cap tech earnings against worrisome new inflation data

  • US stocks on Friday were mixed as Apple and Amazon reported their respective quarterly results. 
  • Stocks were on track to rise in July, with the Nasdaq Composite on course to jump about 10%. 
  • PCE inflation in June rose 0.6%, higher than a consensus estimate of 0.5%. 

Stocks opened mixed on Friday, with investors rounding off the last trading session of July with solid quarterly results from tech behemoths Apple and Amazon, but inflation remained on the radar as the Fed’s preferred gauge was near a four-decade high. 

The tech-concentrated Nasdaq Composite rose, bolstered by stock advances for Amazon and Apple. The online retailer issued an upbeat outlook for third-quarter sales after second-quarter sales of $121.2 billion beat expectations, while the iPhone maker said it fought through a challenging operating environment to keep quarterly sales on track

“A better-than-feared earnings picture is providing a lift and thus far justifying the July rally in stocks,” Ross Mayfield, investment strategy analyst at Baird, told Insider in emailed comments. 

The Nasdaq Composite was headed for a July advance of more than 10% and the S&P 500 was looking at a near 8% gain for the month.

Here’s where US indexes stood at 9:30 a.m. on Friday: 

The Dow was also on course for a win in July but trailed in its daily performance on Friday after the PCE inflation reading for June came in at 0.6% month over month, hotter than the Econoday estimate of 0.5%. The annual rate of 4.8% was the highest since 1983. 

“While the economy will likely need to slow further for Fed to reach its inflation goals, market is already pricing a 2023 pivot at Fed,” said Mayfield. “In the end, inflation needs to comply, and market could see a re-test of lows if it doesn’t, but strong earnings and corporate resilience likely puts somewhat of a floor under equity markets in the near-term.”

Around the markets, the Japanese yen is on track for its largest monthly gain against the US dollar since 2020, with analysts pointing to investors’ fears about weakness in the US economy. 

Oil prices advanced. West Texas Intermediate crude rose 2.2% to $98.55 per barrel. Brent crude, the international benchmark, claimed a 2% rise to $109.33. 

Gold gained 0.4% at $1,758 per ounce. The 10-year Treasury yield rose 3 basis points to 2.70%. 

Bitcoin fell 0.5% to $23,889.12..

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