Stock market today (7/28/22): Stocks wave off recession worries – Kiplinger’s personal finances | Region & Cash

Stocks posted a second straight day of solid gains on Thursday, despite preliminary data showing the US economy shrank 0.9% in the second quarter.

The Commerce Department’s latest report marks consecutive quarterly declines in gross domestic product (GDP) and unleashed a whirlwind of recession chatter on Wall Street.

“Two consecutive quarters of negative GDP is our modest definition of a recession,” said Dan Eye, chief investment officer at financial advisory firm Fort Pitt Capital Group. “But we do agree that the strength of the job market and a well-positioned consumer are limiting the severity of the economic contraction.” Eye adds that the market sees fewer chances of a third 75 basis point rate hike at the Federal Reserve’s September meeting (one basis point is one-hundredth of a percentage point) and “is already starting to price in rate cuts in February 2023.”

The result was also the focus today. meta platforms (META) plunged 5.2% after Facebook’s parent company said second-quarter revenue fell 1% year over year to $28.8 billion — below Wall Street expectations. The company’s earnings also fell short of expectations, as did its revenue guidance for the current quarter.

“This is the first quarter ever for META to report declining year-over-year revenue growth,” said David Wagner, portfolio manager at financial advisory firm Aptus Capital Advisors. “They couple this with the fact that the guidance is significantly lower than expected, which is why the stock is lower.” that appear like black holes has slowed down.”

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Ford engine (F), on the other hand, rose 6.1% after the automaker said second-quarter operating income nearly tripled year over year to $3.7 billion. F also increased its quarterly dividend by 50% to 15 cents per share.

The main indices managed to shake off some early morning weakness and closed near their session highs. That Dow Jones industry average rose 1% to 32,529, the S&P 500 Index rose 1.2% to 4,072 and the Nasdaq Composite rose 1.1% to 12,162.

More news on the stock exchange today:

  • The small cap Russell 2000 increased by 1.3% to 1,873.
  • US Crude Oil Futures fell 0.9% to $96.42 a barrel.
  • gold futures rose 1.8% to $1,750.30 an ounce.
  • Bitcoin rose 4.5% to $23,798.25. (Bitcoin trades 24 hours a day; prices quoted here are as of 4:00 p.m.)
  • Spirit Airlines (SAVE) rose 5.6% after the low-cost airline announced it had ended merger talks Participations of the Frontier Group (ULCC, +20.5%) and instead accepted the US$3.8 billion takeover bid JetBlue Airways (JBLU, -0.4%). “Companies are going to have an uphill battle trying to convince regulators that this deal should be approved,” said Chris Pultz, portfolio manager at alternative investment firm Kellner Capital. “The Biden administration has been vocal about competitiveness in the airline industry, and this will not be well received.”
  • Qualcomm (QCOM) slipped 4.5% after the wireless technology company issued guidance for the current quarter that fell short of the consensus estimate, citing a “challenging macroeconomic environment.” That overshadowed QCOM’s higher-than-expected earnings of $2.96 per share and revenue of over $10.9 billion for the fiscal third quarter. Still, Argus Research analyst Jim Kelleher kept a buy rating on the tech stock. “QCOM has slightly outperformed its peers during the technology sector sell-off, reflecting the continued strength of its silicon products and IP portfolio, and we continue to offer exceptional value,” he said.

The best cheap ETFs we can find

Stock market gains over the past two days have brought some relief to investors, but worries about a possible recession are likely to keep the roller coaster ride going for now. Still, “Despite the volatility, investors should remain invested and seek to move into areas of the market that are more likely to offer downside protection in the volatile months ahead,” says Gargi Chaudhuri, iShares’ head of investment strategy.

To weather the storm of a turbulent market, the risks of an economic slowdown and high inflation, investors should gain exposure to “companies with strong balance sheets and the ability to pass higher costs on to consumers,” which could help build a portfolio to cushion.

That said, there are plenty of individual stocks for investors to choose from, like these companies with pricing power or these steady dividend-buyers. For those wanting broad diversification, consider exchange-traded funds (ETFs), which allow investors to build a core portfolio or take tactical moves across a basket of assets. But with thousands of ETFs to choose from, it can get overwhelming. Here we’ve narrowed the list down to 20 of our favorite funds, which we call the Kip ETF 20. The exchange traded funds featured here offer a variety of strategies for investors, and at low cost.

Karee Venema has long been an F at the time of this writing.

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