Market Recap - S&P 500 Closes the Week Below Key Technical Level

It Was A Tough Week For Stocks. At The Start Of The Week, The S&P 500 Slipped Below Its 200-Day Moving Average.

By the end of the week, the S&P 500 settled 10.3% lower than the July 31 closing high (i.e. a technical correction) and tested support near the 4,100 level. 

Many stocks participated in a broad retreat. Only one of the 11 S&P 500 sectors logged a gain -- utilities (+1.2%) -- while the communication services (-6.3%) and energy (-6.2%) sectors saw the largest declines.

Weakness in the communication services sector was driven by Alphabet, which logged a 9.8% decline on the week after an earnings report that contained some relatively disappointing growth for its cloud business, and Meta Platforms, which fell 3.9% following its earnings report. Microsoft and Amazon.com were met with positive reactions after reporting quarterly results. 

Participants were also digesting a slate of mostly better-than-expected earnings results from blue chip names. Verizon, Coca-Cola, Dow, RTX, General Electric, and 3M were among the standouts in that respect.

Geopolitical angst contributed to the overall negative bias throughout the week, but tensions peaked on Friday following reports that the US carried out airstrikes against Iranian backed targets in Syria. Separate reports indicated that Israel is expanding ground operations in Gaza. Participants learned about those developments right before the weekend when market's are closed for trading and investors can't react in real-time.

There was a heavy news flow this week in addition to the aforementioned headlines and earnings news. The headlines included Ford (F) and the UAW reaching a tentative agreement, the ECB leaving its corridor of key interest rates unchanged following ten consecutive rate increases, and a batch of economic data.

The economic calendar was highlighted by a whopping 4.9% real GDP growth in the third quarter and a September Personal Income and Spending report that failed to show a strong trend of disinflation. Those reports reflect ongoing strength in the economy and inflation that looks somewhat sticky, which is not likely to persuade the Fed to cut rates anytime soon.

Treasuries were better behaved this week, but that did not help stocks much. The 2-yr note yield declined six basis points to 5.03% and the 10-yr note yield fell seven basis points to 4.85%.

In other news, Rep. Mike Johnson (R-LA) was elected Speaker of the House after receiving unanimous Republican support. 

• Nasdaq Composite: -2.6% for the week / +20.8% YTD

• S&P 500: -2.5% for the week / +7.2% YTD

• Dow Jones Industrial Average: -2.1% for the week / -2.2% YTD

• S&P Midcap 400: -2.6% for the week / -4.3% YTD

• Russell 2000: -2.8% for the week / -7.1% YTD

Market Recap - INTEREST RATES ANGST AND GEOPOLITICAL UNCERTAINTY FUEL LOSING WEEK

Equities Experienced A Fairly Broad Retreat This Week.

The negative price action was mostly predicated on interest rates angst with some risk aversion related to the Israel-Hamas war piled on by Friday.  The uncertainty surrounding a potential ground invasion by Israeli forces into Gaza weighed on sentiment ahead of the weekend due to the understanding that participants cannot react in real-time while the markets are closed for trading.

Treasuries continued to act in a volatile manner that resulted in the 10-yr note yield crossing 5.00% at its high this week for the first time since 2007. Ultimately, the 10-yr yield jumped another 29 basis points this week to 4.92%. The 2-yr note yield rose four basis points this week to 5.09%. 

Volatility in the Treasury market was partially a reaction to Fed Chair Powell's speech at the Economic Club of New York on Thursday. His prepared remarks seemingly corroborated the popular view of late that the jump in long-term rates has helped to tighten financial conditions, paving the way for the Fed to proceed cautiously. In answering a question, though, Mr. Powell acknowledged that the economic evidence is not indicating that the Fed is too tight yet with its policy.

Another sticking point for the stock market was the ongoing dysfunction in the House of Representatives. Following three failed rounds of voting this week, Rep. Jim Jordan (R-OH) lost the status of Speaker of the House nominee after a GOP conference vote went against him by a "wide margin," according to Punchbowl News. The House will now head home for the weekend without another vote, according to CNBC.

Data this week painted a mixed picture of the economy. Retail sales were stronger than expected and weekly initial jobless claims hit their lowest level since January. Meanwhile, the existing home sales report was the weakest since October 2010 and the Leading Indicators index was negative for the 18th consecutive month. 

Earnings news was also somewhat mixed. Netflix and Tesla were among the standouts, along with  Dow components Travelers, Procter & Gamble, and American Express.

Only two of the S&P 500 sectors logged a gain this week -- consumer staples (+0.7%) and energy (+0.7%) -- while the real estate (-4.6%) and consumer discretionary (-4.4%) sectors saw the biggest declines.

• Nasdaq Composite: -3.2% for the week / +24.1% YTD

• S&P 500: -2.4% for the week / +10.0% YTD

• Dow Jones Industrial Average: -1.6% for the week / -0.1% YTD

• S&P Midcap 400: -2.0% for the week / -1.5% YTD

• Russell 2000: -2.3% for the week / -4.6% YTD

Market Recap - Stocks grapple with geopolitical uncertainty

Market Participants Entered The Week With News That Israel Declared War On Hamas After A Surprise Attack Launched By Hamas Last Weekend.

The potential for a wider regional clash weighed on sentiment this week, but reports so far give the impression that the Israel-Hamas war is still a two-party conflict. 

Geopolitical angst mounted on Friday following news that Israel warned 1.1 million residents in the northern Gaza Strip to evacuate within 24 hours, which is presumably a pretense to a ground attack in Gaza that will escalate the war. That created some nervousness in the market, which also heard Iran's foreign minister say that Israel's continued siege of Gaza "will face reactions in other areas."

The stock market still fared okay this week, aided by a decline in Treasury yields and some technical buying interest related to the idea that the market was oversold and due for a bounce. Gains were registered in the first half of the week, but buyer conviction fell by the wayside as it got closer to the weekend.

While this week's Producer Price Index and Consumer Price Index reports were not as friendly as investors envisioned, the 10-yr note still did well with the help of safe-haven flows and expectations that inflation rates will improve in coming months as higher rates work in slowing the economy. The 2-yr note yield fell one basis point this week to 5.05%, but the 10-yr note yield declined 15 basis points to 4.63%.

The Treasury market also weathered some relatively disappointing auction results this week for the 3-yr note, 10-yr note, and 30-yr bond. Each was met with relatively soft demand, which came to a head on Thursday following the 30-yr bond auction, prompting a noticeably back up in rates. When geopolitical angst picked up on Friday, however, a rush of safe-haven flows repaired a lot of the weakness following Thursday's sell off. 

Treasuries were also digesting comments from several Fed officials this week who spoke to the idea that the rise in long term rates had tightened financial conditions and may give them leeway to precede carefully on the policy rate.

Oil prices climbed this week in another manifestation of geopolitical worries. WTI crude oil futures jumped 6.0% to $87.80/bbl.

Eight of the S&P 500 sectors registered a gain with energy (+4.5%) leading by a wide margin. The consumer discretionary sector (-0.7%) saw the largest decline.

Earnings season kicked off this week with generally good results, highlighted by JPMorgan Chase, Wells Fargo, Citigroup, and UnitedHealth.

In other news, the House failed to elect a new Speaker this week. Rep. Steve Scalise (R-LA) prevailed in the GOP conference vote, but withdrew his name after failing to get enough support. This leadership void is a reminder that the House can't conduct business, which raises the uncertainty about Congress reaching a budget agreement before the Nov. 17 deadline. 

• Nasdaq Composite: -0.2% for the week / +28.1% YTD

• S&P 500: +0.5% for the week / +12.7% YTD

• Dow Jones Industrial Average: +0.8% for the week / +1.6% YTD

• S&P Midcap 400: -0.5% for the week / +0.5% YTD

• Russell 2000: -1.5% for the week / -2.4% YTD

Market Recap - FIRST WEEK OF THE NEW MONTH BRINGS MIXED ACTION

The First Week Of The New Month Brought Somewhat Mixed Action For The Stock Market.

The S&P 500 (+0.5%) and Nasdaq Composite (+1.6%) registered gains while the Dow Jones Industrial Average (-0.2%) and Russell 2000 (-2.2%) declined. 

Eight of the 11 S&P 500 sectors closed in the red this week. The energy (-5.4%), consumer staples (-3.1%), and utilities (-2.9%) sectors saw the steepest declines while the heavily-weighted information technology (+3.1%) and communication services (+2.9%) sectors closed with the biggest gains. 

The energy sector fell alongside WTI crude oil futures, which declined 8.8% to $83.04/bbl. That weakness was partially attributed to concerns about weakening demand in a slower growth environment influenced by higher interest rates, but oil prices had a big run coming into this week. 

Treasury yields continued to move higher despite a growing sense that the bond and stock market are oversold in the short-term and due for a bounce. The 10-yr note yield jumped another 20 basis points this week to 4.78% and the 2-yr note yield rose two basis points to 5.06%. 

The move in yields partially reflected a recalibration of rate hike expectations following Friday's stronger-than-expected September employment report. Nonfarm payrolls increased a much stronger than expected 336,000 in September (Briefing.com consensus 158,000), and that news was accompanied by upward revisions to July and August data that summed to 119,000 more jobs than previously thought. At the same time, average hourly earnings growth moderated to 4.2% year-over-year from 4.3% in August.

Other notable data this week included the September ISM Services PMI, which showed a modest deceleration in the pace of expansion versus August, and the September ISM Manufacturing PMI, which showed a deceleration in the pace of contraction compared to August.

In addition, there was a cloud of political uncertainty hanging over the market after the House voted 216-210 in an unprecedented action to remove Kevin McCarthy as Speaker of the House. This is likely to complicate the negotiations to avoid another government shutdown after November 17 since business in the House will be stalled until a new Speaker is elected.

• Nasdaq Composite: ++1.6% for the week / +28.3% YTD

• S&P 500: +0.5% for the week / +12.2% YTD

• S&P Midcap 400: -1.9% for the week / +1.0% YTD

• Dow Jones Industrial Average: -0.3% for the week / +0.8% YTD

• Russell 2000: -2.2% for the week / -0.9% YTD

Market Recap - MIXED WEEK TO CONCLUDE LOSING MONTH

The Stock Market Settled The Week Mixed At The Index Level.

Some rebound attempts throughout the week left the Nasdaq and Russell 2000 with slim gains while the Dow Jones Industrial Average and S&P 500 declined 1.3% and 0.7%, respectively. This is a growing belief that the stock market is due for a bounce after suffering steep losses in September, but rising long‐term rates kept stocks in check.

The 10‐yr note yield jumped 13 basis points this week, and 48 basis points this month, to 4.57%. The 2‐yr note yield declined eight basis points this week, and rose 18 basis points this month, to 5.04%.

The concern for stock market participants is not necessarily the size of the rate increases, but rather the pace at which rates are moving. In addition, the jump in rates more recently doesn't appear to be tied to a fear of more rate hikes by the Fed.

The fed funds futures market sees only a 14.2% probability of a 25‐basis points rate hike at the November FOMC meeting, versus 27.5% a week ago and 62.3% a month ago, according to the CME FedWatch Tool.

That understanding may create some angst about what else is driving the Treasury market. Some other factors include: the Fed having a long way to go still with its QT efforts, other central banks possibly selling Treasuries in a bid to support their currencies, and concerns about the budget deficit issue.

In addition to the move in interest rates, seasonality was cited as another potential factor weighing over the market. September, historically, has been the worst month of the year for the S&P 500.

Market participants received some economic data this week, including a weaker than expected August new home sales report, a low level of weekly jobless claims, and some pleasing inflation data in the form of the core‐PCE Price Index for August.

WTI crude oil futures jumped more than $7.00/bbl this month, settling Friday's session at $90.78/bbl, which stoked lingering concerns about inflation expectations, rising gas prices, and a slowdown in consumer spending.

The rate‐sensitive S&P 500 utilities sector saw the largest decline this week by a decent margin, falling 7.0%. The next worst performer was the consumer staples sector (‐2.1%). Only the energy (+1.3%) and materials (+0.2%) sectors registered gains on the week.

• Nasdaq Composite: +0.1% for the week / +26.3% YTD

• S&P 500: ‐0.7% for the week / +11.7% YTD

• S&P Midcap 400: +0.3% for the week / +3.0% YTD

• Russell 2000: +0.5% for the week / +1.4% YTD

• Dow Jones Industrial Average: ‐1.3% for the week / +1.1% YTD

Market Recap - FED AND MARKET RATES KEEPS PRESSURE ON STOCKS

The Major Indices Registered Sizable Declines This Week. 

Softness in mega caps had a disproportionate influence on index performance, but there was no effort to rotate anywhere else so many stocks came along for the downside ride. 

All 11 S&P 500 sectors finished in the red this week. The consumer discretionary (-6.4%), real estate (-5.4%), and materials (-3.7%) were the top laggards while the health care sector (-1.2%) saw the slimmest loss. 

The catalyst for the weakness was another big jump in Treasury yields. The 2-yr note yield climbed eight basis points this week to 5.12%. The 10-yr note yield climbed 12 basis points this week to 4.44%. Including this week's move, the 10-yr note yield is up 35 basis points this month.

Those moves were largely in response to the Fed's hawkish pause on Wednesday.

As expected, the FOMC voted unanimously to leave the target range for the fed funds rate unchanged at 5.25-5.50%. There were few changes to the directive itself, but the market was focused on the Summary of Economic Projections and dot plot, which conveyed two key takeaways: (1) Policy rates are anticipated to remain higher for longer and (2) Fed officials are not expecting to cut rates in 2024 as much as they were anticipating when they updated their forecasts in June.

The median fed funds rate estimate for 2023 was unchanged at 5.6%, but the median estimate for 2024 was 5.1%, versus 4.6% in June. The former estimate suggests officials are still leaning in favor of one more rate hike this year, whereas the latter revision connotes an expectation that rates will come down by only 50 basis points in 2024, as opposed to 100 basis points when estimates were provided in June. Meanwhile, the median estimate for 2025 was 3.9% versus 3.4% in June, and a median estimate of 2.9% was introduced for 2026. The longer-run fed funds rate estimate was maintained at 2.5%, leaving one to infer that the Fed is going to stay committed to its 2.0% inflation target.

Fed Chair Powell said several times at his press conference that the Fed is going to "proceed carefully" when thinking about making a policy move, but said it's plausible that the neutral rate is higher than the longer run rate (2.5%), which he said is part of the explanation for why the economy has been more resilient than expected.

The wrinkle for the market wasn't that the Fed is decidedly hawkish at this point, it was that the Fed is still not dovish.

More Fed officials echoed Mr. Powell's view later in the week, Specifically, San Francisco Fed President Daly (a 2024 FOMC voter), Fed Governor Bowman (FOMC voter), and Boston Fed President Collins (not an FOMC voter this year or 2024) all made similar comments on Friday.

Other central banks also made policy announcements this week. The Bank of England voted 5-4 to leave its bank rate unchanged at 5.25%; the Hong Kong Monetary Authority left its key rate unchanged at 5.75%; the Swiss National Bank left its key rate unchanged at 1.75%; the Bank of Japan made no changes to its policy stance; the Riksbank increased its key rate by 25 basis points to 4.00%; and the Norges Bank increased its key rate by 25 basis points to 4.25%.

In corporate news, there were two notable initial public offerings this week. Instacart and Klaviyo both traded above their IPO price after opening, but rolled over with the rest of the market by the end of the week.

The UAW extended its strike to all GM and STLA parts and distribution centers beginning at noon ET on Friday. This followed confirmation that the UAW made progress on labor talks with Ford, but indicated that Stellantis (STLA) and General Motors (GM) are going to need "serious pushing."

• Nasdaq Composite: -3.6% for the week / +26.2% YTD

• S&P 500: -2.9% for the week / +12.5% YTD

• S&P Midcap 400: -2.8% for the week / +2.7% YTD

• Dow Jones Industrial Average: -1.9% for the week / +2.5% YTD

• Russell 2000: -3.8% for the week / +0.9% YTD

Market Recap - FRIDAY'S RETREAT LEAVES MARKET WITH MODEST LOSSES

The Dow Jones Industrial Average Eked Out A Slim Gain This Week While The S&P 500 And Nasdaq Saw Modest Declines.

The beginning of the week was quiet in terms of market-moving events and somewhat light on participation. The second half of the week featured plenty of market-moving events, capped off with a quarterly options and futures expiration day on Friday. Downside moves had the S&P 500 and Nasdaq close below their 50-day moving averages.

The major indices had been on track for a winning weak until Friday's retreat. Despite a lower finish at the index level, eight of the 11 S&P 500 sectors closed with a gain. Information technology, which is the most heavily weighted sector, declined 2.2%. 

Apple was a top laggard from the info tech sector, dropping 1.8% this week amid reports of ongoing scrutiny in China and following its product event that featured the introduction of the iPhone 15. Adobe was another weak component, dropping 5.6% following its underwhelming fiscal Q4 guidance.

Weak semiconductor constituents also contributed to the sector's underperformance. That weakness followed Arm's successful IPO on Thursday and a Reuters report that Taiwan Semiconductor Manufacturing Co. is delaying chip equipment shipments. The PHLX Semiconductor Index fell 2.5%. 

Netflix, which is among the top performers this year, tumbled 10.4% this week after its disclosure that the ad business is not material yet to its overall revenue. 

The collective weight of large cap losses weighed heavily on index performance.

There were some other corporate news items that drove selling activity, including Spirit Airlines, Frontier Group, Delta Air Lines, and American Airlines all warning about their Q3 outlooks partially due to rising fuel costs.

Additionally, the United Auto Workers launched targeted strikes at three manufacturing plants (one for each of the Big Three) after being unable to reach a deal on a new contract with the automakers. Ford, Stellantis, and General Motors still closed with gains of 2.5%, 5.6%, and 3.0%, respectively, this week.

Market participants also digested a slate of economic releases. Chief among them was the August Consumer Price Index report. Briefly, total CPI was up a robust 0.6%, as expected, and core-CPI, which excludes food and energy, was up 0.3% (Briefing.com consensus 0.2%). That left total CPI up 3.7% year-over-year, versus 3.2% in July, and core CPI up 4.3% year-over-year, versus 4.7% in July.

The key takeaway from the report is that core inflation, which is what the Fed monitors more closely, showed ongoing improvement on a year-over-year basis; however, it is still well above the Fed's 2.0% target, reflecting a sticky quality that probably won't compel the Fed to raise rates further at this point, but which will certainly keep the Fed in a "higher for longer" mindset.

Treasuries handled this week's inflation data reasonably well, which was supportive of stocks. Yields drifted higher, but moves weren't panicky.  The 2-yr note yield rose seven basis points this week to 5.04%. The 10-yr note yield rose seven basis points this week to 4.33%.

Rising oil prices remained top of mind this week. WTI crude oil futures jumped 4.2% to $91.00/bbl.

As a reminder, the Fed meets next week with a policy decision announcement at 2:00 p.m. ET on Wednesday. Market participants are not expecting a rate hike and will be more focused on the updated Summary of Economic Projections and the tone that Fed Chair Powell takes at his press conference. 

• Nasdaq Composite: -0.4% for the week / +31.0% YTD

• S&P 500: -0.2% for the week / +15.9% YTD

• S&P Midcap 400: -0.3% for the week / +5.6% YTD

• Russell 2000: -0.2% for the week / +4.9% YTD

• Dow Jones Industrial Average: +0.1% for the week / +4.4% YTD

Market Recap - APPLE, OIL, AND MARKET RATES DRIVE INDEX LOSSES

The Stock Market Registered Broad-Based Losses On This Holiday-Shortened Week.

The price action in stocks was largely dictated by moves in Apple, market rates, and oil. Some sessions this week featured below-average volume as participants remained in vacation mode after Labor Day weekend.

Apple declined 6.0% this week following reports that Chinese officials are being prohibited from using Apple devices. Semiconductor stocks also sold off in sympathy. The PHLX Semiconductor Index fell 3.2%.

The news goes beyond Apple and the semiconductor stocks, however. The worry for the market is that, if China purposely chooses to make business difficult for a company like Apple, which has a good and important working relationship in China, then it can do so for a lot of other U.S. companies doing business in China.

The sharp increase in oil prices prompted worries about inflation expectations and consumer spending pressures. That understanding contributed to this week's stock sell off. WTI crude oil futures jumped $1.92, or 2.2%, to $87.47/bbl. That move follows news that Saudi Arabia and Russia are planning to extend their voluntary oil production cuts of 1 million barrels per day and 300,000 barrels per day, respectively, through the end of 2023.

Treasury yields climbed this week as market participants reacted to a slate of economic data. The 2-yr note yield rose nine basis points to 4.97% and the 10-yr note yield rose nine basis points to 4.26%. 

The ISM Services PMI showed that services sector activity accelerated in August but prices also increased at a faster pace. The latter will be a concerning development presumably for the Fed, which will be contemplating the notion of rates needing to stay higher for longer.

Initial jobless claims for the week ending September 2 were just 216,000 -- the lowest since February -- and that Q2 productivity was revised lower (to 3.5% from 3.7%) while unit labor costs were revised higher (to 2.2% from 1.6%).

Only two of the S&P 500 sectors logged a gain -- energy (+1.4%) and utilities (+0.3%) -- while the industrials (-2.9%), information technology (-2.3%), and materials (-2.5%) sectors all declined more than 2.0%.

• Nasdaq Composite: -1.9% for the week / +31.5% YTD

• S&P 500: -1.3% for the week / +16.1% YTD

• S&P Midcap 400: -3.6% for the week / +5.9% YTD

• Russell 2000: -3.6% for the week / +5.1% YTD

• Dow Jones Industrial Average: -0.8% for the week / +4.3% YTD

Market Recap - RATES FALL, STOCKS RISE

It Was A Fairly Strong Week For Stocks That Results In Decent Gains For The Major Indices. Some Softer Price Action At The End Of The Week Was Offset By Sizable Gains In The First Half Of The Week.

Including last Friday, the major indices registered four consecutive winning sessions at Wednesday's close. This week's upside moves had the S&P 500 reclaim a position above its 50-day moving average. 

Broad based gains reflected market participants' willingness to buy on weakness, aided by a big drop in market rates. Overall, there just wasn't a lot of conviction on the part of sellers. Many of this week's sessions featured below-average, which is not out of the ordinary for the last week of August ahead of Labor Day weekend. 

Mega cap stocks took charge, benefitting from the drop in market rates.

The 2-yr note yield fell 17 basis points this week to 4.88% and the 10-yr note yield fell seven to 4.17%. Those moves were in response to a batch of economic data that wasn't too bad, but wasn't too good either. Slightly weaker than expected economic reports were a good thing in the market's eyes as it relates to Fed policy. That is to say, market participants have been waiting for data to corroborate the notion that the Fed won't raise rates again. 

The economic calendar this week featured the August Consumer Confidence Index, July JOLTS - Job Openings Report, the second estimate for Q2 GDP, July Personal Income and Spending, the August ISM Manufacturing Index, and the August Employment Situation Report.

A big move in oil prices was lurking under the radar this week. WTI crude oil futures jumped 2.3% on Friday, which brought this week's percentage gain to 7.8%, to $85.55/bbl. That move in oil prices underpinned strength in the S&P 500 energy sector, up 3.8% this week, but also raised eyebrows as it relates to inflation staying persistently high.

Aside from energy, the information technology (+4.4%), consumer discretionary (+3.0%), and communication services (+3.5%) sectors saw the largest gains. The countercyclical utilities (-1.7%) and consumer staples (-0.3%) sectors were the lone holdouts to close with a loss this week.

On the earnings front, Dow component Salesforce was a standout winner following its quarterly results and guidance. Retailers Dollar General and Five Below sank after reporting quarterly results that featured below-consensus guidance while Best Buy and lululemon athletica jumped after their earnings report. 

• Nasdaq Composite: +3.3% for the week / +35.1% YTD

• S&P 500: +2.5% for the week / +17.6% YTD

• S&P Midcap 400: +3.5% for the week / +9.9% YTD

• Russell 2000: +3.6% for the week / +9.1% YTD

• Dow Jones Industrial Average: +1.4% for the week / +5.1% YTD

Market Recap - NASDAQ AND S&P 500 BREAK LOSING STREAK IN WEEK OF GYRATIONS

It Was A Generally Good Week For The Mega-Cap Names And A Relatively Lackluster Week For The Broader Market.

To wit: the market-cap weighted S&P 500 rose 0.8% this week while the Invesco S&P 500 Equal-Weight ETF, based on the S&P 500® Equal Weight Index, posted a fractional loss. The Russell 2000 was down 0.3% for the week and the S&P Midcap 400 Index was flat. The Nasdaq Composite gained 2.3% and the Dow Jones Industrial Average declined 0.4%.

With their gains this week, the S&P 500 and Nasdaq Composite broke a three-week losing streak.

There wasn't a lot of consistency in the trading action this week, which saw its share of gyrations in a week accented with light volume and big news items that included the July Existing Home Sales and New Home Sales reports, the preliminary Manufacturing and Services PMI readings for August, NVIDIA's earnings report, results from a large and diverse batch of retailers, and Fed Chair Powell's policy-oriented speech at the Jackson Hole Symposium.

In brief:

• Existing home sales were slightly weaker than expected, impeded yet again by limited supply and affordability pressures from high mortgage rates.

• New home sales were slightly stronger than expected, driven by sales of more moderately priced homes as higher building costs crimped the supply of lower-priced homes while higher mortgage rates contributed to affordability pressures across the spectrum.

• The preliminary Manufacturing and Services PMI readings showed a deceleration in activity from July and an ongoing contraction in the manufacturing sector.

• NVIDIA delivered another blowout earnings report, replete with much stronger than expected guidance, yet the stock struggled to hold its gains after the report.

• The results from the retailers were a mixed bag but comments from Macy's about weakening consumer credit trends, and disappointing results and/or guidance from Dick's Sporting Goods, Dollar Tree Stores and Foot Locker that were attributed in part to inventory shrink (i.e., theft), overshadowed good news from other reporters.

• Fed Chair Powell stuck by the Fed's 2.0% inflation target; he reiterated that the process of getting inflation back down to 2.0% still has a long way to go; and he acknowledged that the Fed will raise rates again if it is appropriate. Nothing he hasn't said before. What he didn't say is that the Fed is thinking about cutting rates, yet that omission wasn't a surprise either.

The best-performing sectors this week were information technology (+2.6%), consumer discretionary (+1.1%), and communication services (+1.0%). The commonality is that they all have mega-cap stocks under their roof. The energy sector (-1.4%) was the biggest decliner this week with oil prices fading some on continued concerns about China's weakening economy.

That weakening prompted the PBOC to cut its one-year loan prime rate by 10 basis points to 3.45% on Monday and officials to urge financial institutions to assist in stabilizing the stock market. On a related note, Reuters reported Friday that China is planning to lower the duty on stock trading by 50%. China's Shanghai Composite declined 0.6% on Friday and lost 2.2% for the week.

Separately, the Treasury market had its own gyrations this week. The 2-yr note yield saw a trading range that spanned from 4.92% to 5.10%. It settled the week at 5.05%, up 14 basis points for the week. The 10-yr note yield saw a trading range that spanned from 4.18% to 4.35%. It settled the week at 4.24%, down one basis point for the week.

The U.S. Dollar Index was up 0.8% for the week to 104.19.

• Nasdaq Composite: +2.3% for the week / +29.8% YTD

• S&P 500: +0.8% for the week / +14.7% YTD

• Russell 2000: -0.3% for the week / +5.2% YTD

• S&P Midcap 400: flat for the week / +6.1% YTD

• Dow Jones Industrial Average: -0.4% for the week / +3.6% YTD