July Ends on a Down Note

By Brian Hershberg |  Friday, July 30 Weak End. Stocks closed a down week on a down note, as tech stocks led a broad retreat Friday. Major U.S. indexes were still higher on the month.  For stock sleuths seeking a specific reason for Friday's decline, one needn't look far. “Amazon is the culprit,” writes NatAlliance Securities’ Andrew Brenner. The online retailer posted a profit of $15.12 a share, but sales were below expectations and the company warned that Covid-19 vaccines would bring more consumers to bricks-and-mortar stores and away from its online bazaar.   Amazon's disappointing results were read as a negative sign for other e-commerce companies, writes Barron's reporter Jacob Sonenshine: PayPal, eBay, and Etsy were all lower than the broad market. Further weighing on sentiment in the down week was China's regulatory crackdown on some of the country's most popular companies. While losses weren't as sharp as prior weeks, Chinese indexes ended July with steep declines, Jacob notes: Hong Kong’s Hang Seng declined 1.35% Friday, for a monthly loss of 9.9%, while the Shanghai Composite dipped 0.4%, bringing its July decline to 5.4%. The Nasdaq Golden Dragon China Index—which follows U.S.-listed Chinese tech—has tumbled more than 22% across July. In the U.S., however, July was another up month that took indexes near record levels. The Dow Jones Industrial Average lost 0.4% on the week, but retained a 1.25% July gain; the S&P 500 lost 0.4% on the week, while still gaining 2.3% in July; and the Nasdaq Composite shed 1.1% on the week, but stayed in the green in July with a 1.2% gain.  Before we check out for the weekend, we'd be remiss not to look at the initial public offering of Robinhood Markets. The stock-and-security trading app's highly anticipated debut priced at the low end of its $38-to-$42 range and didn't perform much better when shares began trading, falling 8% on day one.  Though the meme-stock facilitator rebounded a bit on day two, up 1% Friday, it drew jeers online, notes Barron's reporter Connor Smith: After Robinhood's debut stumble, a popular post on the WallStreetBets forum on Reddit mocked CEO Vlad Tenev and a commenter quipped that Robinhood would limit trading of its own stock—a reference to late January when online brokerages including Robinhood limited trading in certain volatile stocks like GameStop and AMC Entertainment. Other posts were a bit harsher:  “Future penny stock,” a WallStreetBets commenter wrote on Thursday. Another WallStreetBets user said in a post that they enjoyed watching the stock fall. “I’m logging back into my Robinhood account so I can watch the stock in real time,” wrote another user. It doesn't get much more meta than that last post. Watch our TV show on Fox Business Fridays at 10 p.m. or 11:30 p.m. ET; Saturdays at 10 a.m. or 11:30 a.m. ET, or Sundays at 7 a.m., 10 a.m. or 11:30 a.m. ET. This week, see an interview with Liz Ann Sonders chief investment strategist at Charles Schwab. Plus, big tech's earnings bonanza.

 

DJIA: -0.42% to 34,935.47 S&P 500:  -0.54% to 4,395.26 Nasdaq: -0.71% to 14,672.68 The Hot Stock: DexCom  +13.0% The Biggest Loser: Newell Brands -9.1% Best Sector: Materials +0.4% Worst Sector: Consumer Discretionary -2.8%