The Dividend Cafe - The DC Today - Tuesday, August 1, 2023

Episode Date: August 1, 2023

Today's Post - https://bahnsen.co/3q8RMfd August is off and running! The Dow was up +3.4% in July, nearly half of its total gain in 2023 coming in the month. Both the Nasdaq and S&P were up over +3% as well. Bonds sold off today as yields rallied, and with a weak manufacturing number today, the only reason I can see bond yields climbing today is some expectation (for right or for wrong) that the jobs data will be strong this week. Copper moving higher is not a sign of pending economic weakness, theoretically. Congrats to the U.S. women’s soccer team on their 0-0 tie with Portugal, which enabled them to advance in the World Cup. Yep. Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com

Welcome to the DC Today, your daily market synopsis of the Dividend Cafe, brought to you every Monday through Thursday to bring you up-to-date information and perspective on financial markets. Hello and welcome to the Tuesday DC Today, also the kickoff of the month of August. So we closed out July yesterday. You had the NASDAQ, S&P and Dow all up over 3%. Actually, the S&P was at the least of those three as so much of the gains in July did broaden out and the big seven or so tech companies were less of the gain than they've been all year. So the S&P was a little bit lower and the Dow was a little bit higher, not by much. The Dow was, I think, up 3.6. That's almost half of what it's up on the whole year, just coming from last month. So you had quite a monstrous move

higher in risk assets, both in the months of June and July. Now, we kicked off today. It was actually pretty boring. The Dow was up 71 points, which was 20 basis points to the upside. But the S&P was down 27 basis points and the Nasdaq down almost half a percent. So kind of a just mixed bag, but nothing really right home about on any front. Industrials led the way, but they were only up 0.32%, 32 basis points. And utilities were actually down one and a quarter percent. Consumer discretionary, not far behind. Also nearly one and a quarter percent to the downside. The 10-year, this is the thing I think is more interesting on the day,

if there is anything you could call interesting today. The bond market sold off as the 10-year was up seven basis points, closed at 4.03%. And yet it did that even with reasonably weak manufacturing data. Remember, bond yields normally are going higher at growthier news and bonds are generally rallying, meaning yields are going lower on less growthy news. And the only thing I could think of as to why bonds would have moved the way they did today, yields respond that way, is that there might be some anticipation of a strong ADP private sector payroll report coming tomorrow, the initial jobless claims report coming Thursday, and the BOS, the main jobs data for the month of July coming on Friday. So you have

back to back to back jobs numbers coming over the next three days and maybe bond markets anticipating something kind of strong there and moving yields higher we'll we'll see um the isa manufacturing i mentioned was kind of weak it came in at 46.4 that number probably doesn't mean anything to you but anything below 50 is contraction anything over 50 is expansion and it's been in contraction territory for manufacturing nine months in a row. Now, this was a little bit better than the past couple of months. So the contraction was less than it's been. And you only had growth though, expansion territory in two out of 18 sectors. But nevertheless, new orders, supply deliveries, both were better in July than they had been in June.

As for my expectation of the jobs numbers in the days ahead, the only thing I would say is that whatever happens to ADP tomorrow, I would caution anyone from believing it's foreshadowing what we're going to get from BLS on Friday. And that's not to say that it couldn't end up being some sort of foreshadowing of it, but it has not been lately. And so reading into it may not be a very good idea. But yes, I think a lot of eyes will be on the jobs market for not only this coming month, reflecting last month, but the next couple months as well. In the Ask David, oh, by the way, I think I skipped oil prices. Oil did close above

$82 a barrel. So if it's not at the high on the year, it's very close to that high level that it hit back in April. And so you had oil higher, bonds lower, Dow higher, S&P and NASDAQ lower, mixed bag today, pretty boring. Maybe not as boring as a 0-0 soccer game, which is what took place between the U.S. and Portugal. And somehow I do not understand how it works. This is far too complicated for me. But with a tie, it enabled the USA to advance. So that seems like good news that the USA advanced, but how they advanced on a tie and the other team doesn't is a mystery to me. And I probably won't think about it again. Okay. Ask David in DC today, the written,

check that out. As someone asked me a very important question about why I believe socialism is having a comeback, a bit of resurgence in popularity. And when one looks at the economic track record of free enterprise versus socialism, why would that be the case? And I answer it in written form at the DC today dot com. So I will leave it there. Kind of boring day. And I look forward to come back to you tomorrow, Wednesday. Thank you for listening. Thank you for watching.

Thank you for reading the DC today. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, with Hightower Advisors LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory services are offered through Hightower Advisors LLC. This is not an offer to buy or sell securities. Thank you. The investment opportunities referenced herein may not be suitable for all investors. All data and information referenced herein are from sources believed to be reliable. Any opinions, news, research, analyses, prices, or other information contained in this research is provided as general market commentary and does not constitute investment advice.

The Bonser Group and Hightower shall not in any way be liable for claims and make no express or implied representations or warranties as to the accuracy or completeness of the data Thank you.