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The S&P 500 matched its longest winning streak of the year Thursday as data continued to suggest that the Federal Reserve just might have some breathing room soon.
The Department of Labor reported that 234,000 Americans applied for unemployment benefits during the week ending July 2 – 4,000 more claims than the previous week, and the highest such level in nearly six months.
"It's never a good thing to see layoffs, but the pressure on wages may have now peaked," says Jamie Cox, managing partner for financial planner Harris Financial Group. "A few more weeks of these types of numbers and maybe, just maybe, financial conditions are tight enough to allow the Fed to throttle back on the scale of rate increases."
A much stronger indicator of whether the U.S. central bank will do just that comes tomorrow morning, in the form of the June jobs report.
"The key for tomorrow's jobs report is that it furthers the idea that we've hit 'peak hawkishness' with the Fed and 'peak inflation,'" says Tom Essaye, editor of the Sevens Report. "If the jobs report reflects those two realities, it'll likely spur a continued relief rally. If it implies the opposite, look for another painful decline."
Also helping to drive stocks was data suggesting global supply-chain disruption might be easing. Jeffrey Roach, chief economist for independent broker-dealer LPL Financial, notes that New York Fed data showed that global supply chains were under less pressure in June compared to May.
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"The small improvement in supply chains will eventually filter through to improved consumer pricing," says Roach, who adds that supply-chain effects take about four months to affect headline consumer prices.
Energy stocks (+3.6%) were the top sector Thursday, led by the likes of APA (APA, +7.8%) and Devon Energy (DVN, +5.2%). Data from the Energy Information Administration showed a recent snap-back in gasoline demand, helping U.S. crude oil futures rebound 4.3% to $102.73 per barrel.
Technology stocks (+2.1%) also produced robust gains, largely on the back of the semiconductor industry. Just a few days after Micron (MU, +2.6%) warned that it expected demand for consumer-product components to wane, Samsung triggered a relief rally after saying it expected second-quarter revenues to improve by 22%; Qualcomm (QCOM, +5.8%), Advanced Micro Devices (AMD, +5.2%) and Nvidia (NVDA, +4.8%) were among the beneficiaries.
The S&P 500 (+1.5% to 3,902) posted its fourth consecutive gain to equal its previous 2022-best streak during the end of January and beginning of February. The Nasdaq Composite (+2.3% to 11,621) also made it four in a row, while the Dow Jones Industrial Average (+1.1% to 31,384) strung together two days of black ink.
Other news in the stock market today:
You know how you've heard that you should pay off your debt before you start investing? Well … that's not necessarily true. Sometimes it pays to knock out your IOUs first, but depending on how high or low your interest rate on that debt is, investing might actually be a better use of your money.
That's just one example of several investing myths that are often touted as conventional wisdom.
Most of the time (but not always), the people who peddle these misconceptions don't have ill intent – sometimes, they pick it up from other people they respect, and sometimes, things that used to be true have simply changed over time. All the same, these myths could result in financial decisions that aren't right for you.
Today, we'd like to put some of these myths to bed. Read on as a group of financial experts review seven of the most common investing myths and explain why they don't hold up.
Kyle Woodley was long AMD and NVDA as of this writing.
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