U.S. stock indexes ended slightly lower, snapping a three-session streak of gains on Monday, following the S&P 500’s and Dow industrials’ biggest monthly gain since November 2020.What happened
The Dow Jones Industrial Average
DJIA,
-0.14%
finished down by 46.73 points, or 0.1%, at 32,798.40.
The S&P 500
SPX,
-0.28%
ended 11.66 points, or 0.3%, lower at 4,118.63 after flipping between small gains and losses.
The Nasdaq Composite
COMP,
-0.18%
closed down by 21.71 points, or 0.2%, at 12,368.98.
Those are the largest one-day declines for all three indexes since July 26.
Stocks had finished sharply higher on Friday, leaving the Dow up 6.7% for July and the S&P 500 higher by 9.1% last month; those were the biggest monthly gains since November 2020. The Nasdaq surged 12.3% for its best monthly performance since April 2020 and its strongest July on record, according to Dow Jones Market Data.
What drove the market Stocks flipped between losses and gains on Monday after the Institute for Supply Management reported that its closely followed manufacturing gauge dipped to 52.8% in July from a reading of 53% a month earlier. Economists polled by The Wall Street Journal had expected the index to come in at 52.1%. While any number above 50% signifies growth, the latest reading was the weakest since June 2020. “Although the activity outlook remains challenging, we believe that the risk-reward for equities is looking more attractive as we move through 2H,” said JPMorgan Chase & Co.’s Marko Kolanovic, Nikolaos Panigirtzoglou and others in a note. They cited the S&P 500’s “second sharpest P/E (price-to-earnings ratio) de-rating of the past 30 [years], exceeding the typical compression seen during prior recessions,” and said that “while the current equity multiple is in-line with the historical median, we believe it is better than fairly valued given the shift in industry mix to higher quality companies.” Need to Know: FAANGs ain’t what they used to be, so beware the bear-market bounce says this hedge-fund manager On Friday, data showed that higher gasoline prices led the personal-consumption-expenditures price index up 1% in June, exceeding forecasts of a 0.9% advance. June inflation measured by the PCE index showed the cost of living over the past year climbed 6.8%, the highest rate since January 1982. Last Wednesday, the Fed ended its two-day policy meeting with another 75-basis-point rate hike in an effort to curb soaring inflation. Fed Chair Jerome Powell said another …