Due to weak manufacturing data, the stock market rose till noon

A slump in the manufacturing index in July and news of strong earnings and acquisitions provided some lift, with the stock market reversing early losses to hold gains by noon. Boeing (BA) led the blue chips.

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The Nasdaq Composite led the major indices, up 0.5%. The S&P 500 was up 0.1% and the Dow Jones Industrial Average was up 0.2%. The small-cap Russell 2000 was down 0.1%. The Innovator IBD 50 ETF (FFTY) rose 0.1%.

Volume fell on the Nasdaq and rose on the NYSE compared to the same time on Friday.

The tech-heavy Nasdaq climbed 12% in July, its best month since April 2020. The S&P 500 rose 9.1% in July, while the Dow Jones Industrials rose 6.7%. This was the best monthly performance for the S&P and Dow since November 2020.

US Stock Market Today Overview Index Symbol Change Price Gain/Loss % Dow Jones (0DJIA) 32912.53 +67.40 +0.21 S&P 500 (0S&P5) 4135.07 +4.78 +0.12 Nasdaq (0NDQC) 12453.85 +63.16 +0.51 Russell 2000 (IWM) 187.06 -0.19 -0.10 IBD50 (FFTY) 28.49 +0.04 +0.14 Last Updated: 12:08PM ET 8/1/2022

Investors have been encouraged that slower economic growth could prompt the Fed to raise rates at a slower rate.

Weak PMI data put pressure on the stock market

However, the downturn could be worse than what investors had bargained for. This morning, the seasonally adjusted S&P Global US Manufacturing Purchasing Managers’ Index was 52.2 in July, down from 52.7 in June and roughly in line with Econoday estimates.

“With the exception of the pandemic lockdown period, US manufacturers in July reported the toughest business conditions since 2009,” said Chris Williamson, chief business economist at S&P Global Market Intelligence. “Growth in the spring has reversed sharply, with new orders for factory goods down for the second straight month in July, the first drop in output for two years and a sharp slowdown in employment growth.”

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The ISM Manufacturing Index for July came in at 52.8, up and slightly lower than the previous month.

Asian and European stock markets started the week mostly with gains. The Hong Kong Hang Seng Index gained 0.1% and the Shanghai Composite 0.2%. Japanese stocks also gained 0.7% in the Nikkei 225 index.

European stocks were mostly up in afternoon trade. The London FTSE 100 rose 0.1%. The German DAX rose 0.2% and the French CAC 40 index fell 0.1%.

The 10-year Treasury yield continued to slip to 2.59% on Monday morning. Meanwhile, US oil prices fell 5.5% to around $93 a barrel.

Earnings, Acquisition Lead Stock Market

After a strong earnings release early Monday, Builders FirstSource (BLDR) rose nearly 8%, easily beating analysts’ estimates for both earnings and sales.

Global Payments (GPN) grew 6% on strong results and agreed to receive EVO payments (EVOP) for $4 billion. EVOP rose 19% on the news.

Chipmaker Onsemi (ON) beat earnings and sales views for Q2 and guidance higher for the current third quarter, but shares declined 4.8%.

Dow Jones aerospace giant Boeing (BA) soared more than 7% after the company temporarily avoided a strike at three defense manufacturing plants and cleared a regulatory hurdle to resume deliveries of its 787 Dreamliner.

Celsius Holdings (CELH) increased 13% after PepsiCo (PEP) and Celsius announced a long-term strategic distribution arrangement, which includes a PepsiCo investment in Celsius. An IBD50 stock is well ahead of the 5% buy zone after clearing an aggressive entry with Celsius Volume, and looks to be forming a big cup with a new buy point of 110.32.

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Volvoline (VVV) fell 1.4% after announcing a definitive agreement with Aramco to sell its global products business for $2.65 billion in cash.

Follow Michael Molinsky on Twitter @IMmolinski

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