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Stocks continued their pattern of volatility before hitting fresh records at the end of the week. As the summer doldrums have begun, traders have been focusing their attention on economic data. Both labor and manufacturing data this week continued to point to a brighter economic future, and leaving the COVID-19 crisis behind.
Inflation also continued to be on traders’ minds this week with the official release of the CPI report. With inflation numbers clocking in less than previous readings, traders cheered. The constant worry if the Fed will be forced to reverse course, raise interest rates and end monetary stimulus has been a major theme to the volatility this year.
As for the corporate world, earnings have pretty much slowed to a trickle with only a handful of firms reporting. Here again, guidance has been more optimistic than in previous weeks. Meanwhile, the slowness of the summer has provided for a lack of corporate actions.
All in all, volatility provided some choppiness to the week’s trading. But the strong economic data allowed stocks to finish the week strong and hit new records on several of the major indices.
Be sure to check out our previous Wrap here, when the shortened holiday week still provided some good gains.