Stocks soar in best week of 2024 as economic data eases recession concerns
Stocks had their strongest week of 2024, with fresh economic data calming fears of a looming recession. The S&P 500 surged nearly 4%, while the Nasdaq Composite climbed over 5.2%. The Dow Jones Industrial Average also saw gains, rising almost 3%.
Looking ahead, a relatively quiet economic calendar will shift market attention to the Federal Reserve. All eyes will be on Fed Chair Jerome Powell, who is set to speak on Friday morning at the Jackson Hole Symposium. Investors will be eagerly listening for any clues about when and how much the Fed might cut interest rates in 2024.
On the corporate front, retail earnings reports will continue to take center stage. Key announcements are expected from Lowe’s, Target, Macy’s, TJX, and BJ’s.
The stock market’s rebound this week was driven by a series of positive economic reports. Earlier concerns about a potential recession, sparked by a weaker-than-expected jobs report, were eased by data showing that inflation continues to trend downward toward the Fed’s 2% target, while consumer spending remains strong and layoffs are not increasing.
Economists and Wall Street strategists suggest that this week’s data indicates the much-anticipated “soft landing”—where the U.S. economy avoids a severe downturn as inflation retreats to the Fed’s goal—may now be within reach. “This week’s data calendar delivered mostly good news. Inflation was generally tepid, and economic activity still looks healthy,” noted Michael Gapen, head of economics at Bank of America Securities, in a weekly note to clients on Friday. “The recent data flow aligns with our soft-landing forecast.”
