(Bloomberg) American equities recently hit record highs, leaving investors looking for leads from economic data available to provide guidance on future trades.
Among the factors to be considered is the spread of the highly transmissible delta variant of COVID-19, which could hamper international trade and tourism. Travel stocks are among the worst-performing in both Europe and the US so far in the second half.
Investors are also looking at the tapering of the Federal Reserve, with Chair Jerome Powell maintaining a dovish stance in his latest speech. The bond-buying could be cut down in the coming months, while rates are expected to be maintained in the short term.
Tech stocks are likely to be impacted by the ongoing global chip shortage, with several firms expecting the semiconductor supply issues to last until 2023. Several companies may continue to see a dent in their earnings due to constraints.
China’s economic recovery is being closely watched, as a slowdown could drag global profits and possibly cause losses by the fourth quarter. The country has also imposed a crackdown on technology, education, and property.
Second-quarter earnings record historic highs in the second quarter, with most of the S&P 500 stocks reporting better-than-expected earnings.
The S&P 500 is up 0.27%.
