US stock indices are closing the week near historical highs. By the close of Thursday, the S&P 500 index set a new closing record, climbing 0.65% to 7798.99 points, while the Dow Jones Industrial Average added 0.13%. On Friday, August 14, markets are processing the latest macroeconomic data.
Markets received support this week from cooling inflation data (CPI and PPI), which eased investor concerns and strengthened expectations that the US Federal Reserve will begin a rate cutting cycle in the coming months, rather than increasing rates. Both the S&P 500 and Nasdaq are poised for weekly gains.
On Friday, the US Census Bureau reported that retail sales unexpectedly fell by 0.6% in July, marking the sharpest decline in over a year. Investors are also evaluating the recently released University of Michigan consumer confidence index data.
Asian markets sent a positive signal this week, with South Korea's KOSPI index and Japan's Nikkei showing strong growth, indicating continued risk appetite in global markets.
Strong corporate earnings reports bolstered stock movements. Market participants' attention is now shifting to retailer earnings releases next week, including Target and Walmart, followed by the crucial Nvidia report due on August 26.
Global indices, including the MSCI All-World, are trading near historical peaks. Investors continue to focus on artificial intelligence, where strong results from semiconductor companies are helping to alleviate concerns about the massive expenditures required for AI infrastructure.
Brent crude oil has stabilized around $87 per barrel amidst ongoing geopolitical tensions. Gold has corrected and is trading in the range of $4350-$4396 per ounce, as investors are taking profits after recent record highs.
The dollar is trading near 159 yen amidst speculation about a potential further tightening of monetary policy by the Bank of Japan. How these factors will impact market dynamics in the coming days remains to be seen, dependent on central bank actions.
The VIX volatility index continues to decline, reflecting a low level of market fear and strong "bullish" confidence.
