Investors will try to find their footing once again Thursday, as they took for signs the economy isn't deteriorating as quickly as feared a few days ago. Wall Street got some good news on that front, after fresh jobless claims pointed to some resilience in the labor market. After a disappointing July jobs report served as one of the catalysts for the recent bout of selling, investors expect the consumer will be in greater focus for the balance of the year.
We are reminded that earnings drive stocks in the long term," analyst Julian Emanuel wrote in a Thursday note to clients, emphasizing that the better-than-expected earnings season so far remains a bright spot for investors. Earnings growth of more than 11% during the second quarter, with estimates holding relatively steady for 2024 and 2025 despite some signs of a slowdown in the U.S. economy, "bodes well" heading into the upcoming presidential election, Emmanuel said.