The futures were trading higher, as we get ready to finish up July, after a huge week that saw all of the major indexes end Friday solidly higher. Hopes for a soft landing for the economy and the end of the interest rate hikes got a solid tailwind Friday morning after an inflation metric the Federal Reserve follows closely, the PCE price index, came in at 4.1%, slightly below estimates. That was the lowest annual increase in the data point since September of 2021. In addition, the employment cost index, another Fed favorite, finished the second quarter up 1%, less than expected. While consumer spending increased, income declined, which could be an omen going forward.
Treasury yields were lower across the board on Friday, as buyers took advantage of some scale selling earlier in the week. The 10-year note dropped back under the 4% level to finish the day at 3.97%, while the short two-year paper closed at 4.89%. While Fed Chair Powell suggested the central bank does not see a recession this year, and it is indeed unlikely as you need two quarters in a row of negative growth, some feel things could get dicey by the fourth quarter. The inversion has been a spot-on indicator for decades, and it is still in place.
Brent and West Texas Intermediate crude finished up a solid week of gains on Friday, with both of the indexes closing over the $80 level with: Brent at $84.75 and WTI at $80.39. The rig count saw another small decline last week, but with production cuts kicking in and demand surging, prices could be poised to go higher in August. Natural gas closed Friday up almost 2% at $2.64.
Gold also finished Friday higher, at $1,958.30, as traders cited the lower but still strong PCE numbers as a tailwind for the bullion on Friday. Many gold traders are also convinced that the ongoing rate increases are bound to weaken the economy eventually. Bitcoin closed Friday at $29,311.30.
24/7 Wall St. reviews dozens of analyst research reports each weekday with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.
These are the top Wall Street analyst upgrades, downgrades and initiations seen on Monday, July 31, 2023.
ASE Technology Holding Co. Ltd. (NYSE: ASX): Goldman Sachs upgraded the shares to Buy from Neutral and raised its $6.60 price target to $9.20. The consensus target is $6.91. The stock closed trading on Friday at $8.40, up close to 4% for the day on the upgrade.
Block Inc. (NYSE: SQ): Exane BNP Paribas upgraded the stock to Outperform from Underperform and has a $95 target. The consensus target is $85.15. Friday’s $78.36 close was up over 3% on the day.
California Water Service Group (NYSE: CWT): Janney upgraded the shares from Neutral to Buy with a $66 target price. The consensus target is $56.50. The stock closed on Friday at $52.05, which was up over 2% for the day.
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