Here are the key news items that investors need to know to start their trading day:
1. S&P Keeps Winning
Stocks went up on Friday, with the S&P 500 closing out another positive month. The index rose by 1.01%, ending the session at 5,648.40. It also gained 2.3% in August, marking its fourth winning month in a row.
This recovery, after last month’s global sell-off, was helped by strong gains in consumer staples, real estate, and health care sectors. The Dow Jones Industrial Average reached a new record high just before the session ended, closing up 0.55% at 41,563.08. The Dow rose almost 1.8% for August. The Nasdaq Composite also went up, gaining 1.13% on Friday and 0.7% for the month.
2. Inflation Matches Expectations
Inflation went up slightly in July. The personal consumption expenditures (PCE) price index increased by 0.2% from the previous month and was up 2.5% compared to a year ago, which matches the Dow Jones estimates.
Core PCE also rose by 0.2% in July and was 2.6% higher than a year ago, just below the expected 2.7%. Traders are fully expecting the Federal Reserve to cut interest rates in September. Joseph Brusuelas, chief economist at RSM, said, “The U.S. economy is set to grow at or above the long-term rate of 1.8% as the Fed starts cutting rates, which should support growth and hiring.”
3. X Still Blocked
Elon Musk’s platform, X, remains blocked in Brazil. On Monday, the country’s federal supreme court panel unanimously agreed to keep the suspension in place. Top justice Alexandre de Moraes ordered the suspension late Friday, warning earlier that X would be blocked if Musk and X didn’t appoint a legal representative in Brazil within 24 hours.
The suspension took effect by early Saturday. The financial assets of Starlink, another business owned by Musk, have also been frozen in Brazil to make sure X’s fines are paid.
4. More Restaurants Going Bankrupt
This year, many restaurant chains have filed for Chapter 11 bankruptcy. So far, at least 10 chains—excluding franchisees with multiple locations—have filed for bankruptcy, with three happening in August alone.
Red Lobster, World of Beer, and Sticky’s Finger Joint are some of the chains that have filed. The number could rise by the end of the year, as other chains like BurgerFi have hinted they might also seek bankruptcy. The owner of Anthony’s Coal Fired Pizza & Wings has even expressed serious concerns about being able to stay in business.
5. Lower Risk of Death from Covid?
Wegovy and Ozempic might help lower the risk of dying from Covid-19. Studies published last week by the Journal of the American College of Cardiology (JACC) found that people taking a 2.4 mg dose of semaglutide, the active ingredient in Novo Nordisk’s popular drugs, had a 33% lower chance of dying from Covid-19.
Additionally, co-author Benjamin Scirica noted that in his study, patients who took semaglutide had a 29% reduction in deaths from causes not related to heart issues. Other JACC studies also showed that semaglutide reduced deaths among people with chronic kidney disease and improved symptoms of heart failure and inflammation.
Summary
The S&P 500 keeps going up, and inflation is about what was expected, so the Fed might cut rates. Musk’s platform, X, is still blocked in Brazil. Many restaurant chains have gone bankrupt, and Wegovy and Ozempic might help lower the risk of dying from Covid-19.
