August begins with key economic data and earnings reports as momentum recovers
Investors are watching closely to see if the recent recovery in market momentum can be sustained. The iShares MSCI USA Momentum Factor ETF (MTUM) saw a significant rebound after hitting oversold levels, gaining over 5% on Thursday alone. However, analysts caution that near-term gains may not last unless key resistance levels are broken through. Next week brings several critical economic reports and earnings releases from major companies like McDonald's, Costco, Walt Disney, Palantir Technologies, and Advanced Micro Devices. The upcoming jobs report is expected to show continued but slightly weaker labor market growth with 87,500 nonfarm payrolls added in July. Earnings season has been strong so far, with over 85% of S&P 500 companies beating expectations and profits on track for a more than 47% increase year-over-year. Analysts remain cautiously optimistic but note ongoing challenges such as the Federal Reserve's communication strategy, upcoming midterms, interest rate uncertainty, and historically weak stock performance in August. Technical analysts emphasize that how momentum stocks handle key resistance levels will be crucial to determining broader market direction.
Tickers: $AMD $COST $DIS $KHC $MCD $MTUM $PLTR
Topics: economic data ETFs Federal Reserve momentum factor stock market