S&P 500 Index Advances 1.91% in August, Earnings Guidance Better Than Historical Levels

The S&P 500 Index rose 1.91% in August, with nine of 11 sectors delivering positive returns. The top 10 performers included Paramount Skydance Corp., Albemarle Corp., and UnitedHealth Group Inc. Earnings guidance for Q3 is better than historical levels, with 64 negative preannouncements and 45 positive outlooks. Earnings growth forecasts for Q3 are 8.4%, unchanged from last month. The forward four-quarter price-to-earnings multiple for the S&P 500 stood at 22.9 times.

The S&P 500 Index rose 1.91% in August, with nine of 11 sectors delivering positive returns [1]. The top 10 performers included Paramount Skydance Corp., Albemarle Corp., and UnitedHealth Group Inc. [2]. Earnings guidance for Q3 is better than historical levels, with 64 negative preannouncements and 45 positive outlooks [3].

The CNN Money Fear and Greed Index showed a decline in overall market sentiment but remained in the "Greed" zone on Friday, indicating investor optimism despite the dip in the U.S. stocks [1]. The 30-stock Dow gained more than 3% in August, while the S&P 500 recorded around 2% surge and the tech-heavy Nasdaq gained around 1.6% during the month [1].

On the economic front, the Personal Consumption Expenditures price index, a broad measure of inflation, increased 2.6% from a year earlier in July, aligning with Wall Street expectations [1]. U.S. personal income increased by 0.4% month-over-month to $25.905 trillion in July, while personal spending rose by 0.5% to $20.802 trillion [1].

Alibaba Group Holding BABA shares jumped around 13% on Friday following the release of its fiscal first-quarter results, as the e-commerce giant co-founded by Jack Ma reported revenue that exceeded analyst expectations [1]. Marvell Technology Inc. MRVL shares dropped 19% after the company issued third-quarter sales guidance with a midpoint below estimates [1].

Most sectors on the S&P 500 closed on a positive note, with health care, real estate, and consumer staples stocks recording the biggest gains on Friday. However, information technology and consumer discretionary stocks bucked the overall market trend, closing the session lower [1].

The Dow Jones closed lower by around 92 points to 45,544.88 on Friday. The S&P 500 fell 0.64% to 6,460.26, while the Nasdaq Composite dipped 1.15% at 21,455.55 during Friday's session [1].

Investors are awaiting earnings results from Nio Inc. NIO, Signet Jewelers Ltd SIG, and Zscaler Inc ZS today [1].

References:
[1] https://www.benzinga.com/markets/equities/25/09/47442070/nasdaq-dips-over-1-but-records-gains-for-august-investor-sentiment-declines-fear-index-remains-in-greed-zone
[2] https://finance.yahoo.com/news/were-5-top-performing-stocks-081000487.html
[3] https://finance.yahoo.com/news/live/earnings-live-salesforce-stock-sinks-on-tepid-guidance-figma-slides-american-eagle-soars-204659906.html