In the world of finance, market fluctuations are a daily occurrence, and the latest week has been no exception. As of July 26, 2024, US equity indices presented a mixed bag of results, with notable shifts in both technology and small-cap sectors. The tech-heavy Nasdaq 100 continued its downward trend, primarily influenced by disappointing earnings reports from major technology players such as Tesla and Alphabet. In contrast, the small-cap Russell 2000 index managed to thrive, showcasing solid gains amidst the turbulence.

On the Australian front, the ASX 200 index saw its three-week winning streak come to an abrupt halt, dipping below the significant 7,900 mark. This decline was largely attributed to the local technology sector mirroring the struggles of US tech stocks, compounded by downturns in energy and resource stocks.

Economic indicators released during the week painted a varied picture of growth and activity. The US S&P Composite Purchasing Managers’ Index (PMI) rose to 55 in July, up from 54.8 in June, marking its strongest growth rate since April 2022. Additionally, the advance estimate of the US second-quarter gross domestic product (GDP) showed an impressive acceleration to 2.8%, surpassing the consensus expectation of 2.0% and significantly up from 1.4% in the previous quarter.

The landscape of US durable goods orders also demonstrated positive movement, with orders excluding transportation rising by 0.5% in June, compared to a slight decline of -0.1% in the preceding month. These figures suggest a resilience in manufacturing and consumer demand despite the broader market uncertainties.

Across the Atlantic, the Euro Area experienced a dip in its composite PMI for July, falling to 50.1 from 50.9, indicating a slowdown in growth. Meanwhile, the UK composite flash PMI showed a modest improvement, rising to 52.7 from 52.3, reflecting a slight expansion in economic activity.

In Asia, the People’s Bank of China (PBOC) surprised markets by cutting its primary policy rate by 10 basis points to 1.7%, marking the first reduction in a year. This move is seen as a response to the ongoing economic challenges faced by China, aimed at stimulating growth.

Commodity markets also saw notable fluctuations. Crude oil prices fell by 0.46% during the week, closing at $78.28 per barrel. This decline came after a stronger-than-expected US GDP report, which often correlates with increased demand for oil. In the precious metals market, gold experienced a significant pullback, dropping 1.50% to $2,365, following a record high of $2,483 the previous week.

Investor sentiment remains cautious, as reflected by Wall Street’s Volatility Index (VIX), which surged to 18.47 from 16.51, indicating increased market anxiety.

Looking ahead, several key economic indicators are set to be released, which could further influence market directions:

• New Zealand: Building Permits on Tuesday, July 30 at 11:30 AM AEST
• New Zealand: ANZ Business Confidence on Wednesday, July 31 at 11:00 AM AEST
• Australia: Q2 Consumer Price Index (CPI) on Wednesday, July 31 at 11:30 AM AEST
• Australia: Retail Sales on Wednesday, July 31 at 11:30 AM AEST
• China: NBS Manufacturing PMI on Wednesday, July 31 at 11:30 AM AEST
• Japan: Bank of Japan (BoJ) Interest Rate Decision on Wednesday, July 31 AEST
• China: Caixin Manufacturing PMI on Thursday, August 1 at 11:45 AM AEST
• United States: JOLTS Job Openings on Wednesday, July 31 at 12:00 AM AEST
• United States: CB Consumer Confidence on Wednesday, July 31 at 12:00 AM AEST
• United States: ADP Employment on Wednesday, July 31 at 10:15 PM AEST
• United States: Employment Cost Index on Wednesday, July 31 at 10:30 PM AEST
• United States: FOMC Meeting on Thursday, August 1 at 4:00 AM AEST
• United States: ISM Manufacturing PMI on Friday, August 2 at 12:00 AM AEST
• United States: Non-Farm Payrolls on Friday, August 2 at 10:30 PM AEST
• European Union: Q2 GDP on Tuesday, July 30 at 7:00 PM AEST
• European Union: CPI on Wednesday, July 31 at 7:00 PM AEST

As these reports unfold, traders and investors will be closely monitoring the data for indications of economic health and potential market movements.