Dow notches longest winning streak since 2017

The Dow Jones Industrial Average rose Monday, notching its longest winning streak since February 2017, to kick off a busy week of key earnings reports and a major policy decision from the Federal Reserve.

The 30-stock Dow gained 183.55 points, or 0.52 per cent, to 35,411.24 — posting an 11th straight day of gains. The S&P 500 rose 0.40 per cent to 4,554.64. The Nasdaq Composite added 0.19 per cent to 14,058.87.

Market participants expect a major week for earnings, as well as the Federal Reserve’s last policy meeting until September, which could test the recent rally.

The Fed is widely anticipated to raise rates by a quarter percentage point at the conclusion of its meeting on Wednesday.

Traders will be listening to comments by Chair Jerome Powell to get a sense of the central bank’s position on what happens next as it tries to navigate a soft landing for the economy.

Wall Street is anticipating earnings results from some 150 S&P 500 companies this week, or about 30 per cent of the broader index. Big tech earnings are on deck from Alphabet, Microsoft and Meta. Several notable pharmaceutical companies are getting ready to report, and it’s a major week for industrial companies and big oil as well.

Canaccord Genuity's strategist, Tony Dwyer, believes the recent Dow's hot streak is extending the market rally, and the small cap Russell 2000 may bounce back as it appears to be bottoming out relative to the S&P 500, making it a favourable choice for the foreseeable future.

In commodity-related news, oil reached a three-month high, trading above a key technical barrier due to signs of a tighter crude market outweighing the Federal Reserve's potential hike, with West Texas Intermediate surpassing US$79 a barrel amid OPEC+ cuts materialisation and an Exxon refinery outage.

Turning to US sectors, as a result of oils price rise, the energy sector led gains with Chevron rising nearly 2 per cent after the oil giant reported preliminary second-quarter adjusted earnings Sunday that topped analysts’ estimates. Utilities was the worst performer.

Traders will also watch for the personal consumption expenditures index, the Fed’s preferred inflation gauge, which is due at the end of the week.

Futures

The SPI futures are pointing to a 0.6 per cent gain.

Currency

One Australian dollar at 7:15 AM was buying 67.41 US cents.

Commodities

Gold lost 0.48 per cent. Silver fell 1.41 per cent. Copper added 0.76 per cent. Oil gained 2.43 per cent.

Figures around the globe

European markets closed mixed. London’s FTSE gained 0.19 per cent, Frankfurt added 0.08 per cent, and Paris closed 0.07 per cent lower.

Turning to Asian markets, Tokyo’s Nikkei gained 1.23 per cent, Hong Kong’s Hang Seng fell 2.13 per cent while China’s Shanghai Composite closed 0.11 per cent lower.

The Australian sharemarket closed 0.10 per cent lower at 7306.

Ex-dividends

Blackmores (ASX:BKL) is paying 329 cents fully franked

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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