U.S. Markets: The major indexes posted gains for the week, lifting the benchmark S&P 500 index to within roughly 0.2% of its all-time high from February.  The Dow Jones Industrial Average added almost 500 points, rising 1.8% to 27,931.  The technology-heavy Nasdaq Composite ticked up just 0.1% to 11,019.  By market cap, the large-cap S&P 500, mid-cap S&P 400, and small-cap Russell 2000 all coincidentally finished the week up 0.6%.

Commodities: Gold had its first down week in more than two months closing at $1949.80 an ounce, a decline of ‑3.9%.  Silver declined an even steeper -5.3% to $26.09 per ounce.  Crude oil finished up for a second week.  West Texas Intermediate crude oil finished the week at $42.01 per barrel—a gain of 1.9%.  The industrial metal copper, viewed by some analysts as a barometer of world economic health due to its wide variety of uses, rebounded 2.4% last week.

U.S. Economic News: The number of Americans filing for first-time unemployment benefits fell by 228,000 last week to 963,000.  Economists had expected 1.1 million new claims.  This was the lowest level since March when the economic shutdown from the coronavirus took hold.  While still far from normal, the decline in initial claims suggests a gradual improvement in labor market conditions.  It also implies that the economic recovery that had stalled in July is getting back on track.  Continuing claims, which counts the number of Americans already receiving benefits, fell by 604,000 to 15.486 million.

The number of job openings rose by over half a million in June, according to the latest data from the Labor Department.  The Job Openings and Labor Turnover Survey, known as the JOLTS report, showed job openings rose by 518,000 to 5.9 million at the beginning of summer.  The reading was above the median forecast of 5.3 million.  The increase followed a gain of 375,000 in May.  The most significant gains in openings came from accommodation and food service, other services, and arts.  The most significant declines were in construction and state and local government education.  The number of people who voluntarily left their jobs, known as the “quits rate,” rose to 1.9% from 1.8% in May.  That reading remains significantly below its peak of 3.2% before the pandemic hit.

Confidence among the nation’s small business owners slipped last month as cases of the coronavirus continued to surge across the country.  The National Federation of Independent Business (NFIB) reported its Small Business Optimism Index came in at 98.8 in July, a 1.8 point decline from its June reading.  Economists had expected a reading of 99.9.  The NFIB is a monthly snapshot of small businesses in the U.S., which account for nearly half of private-sector jobs.  Economists look to the report for a read on domestic demand and to extrapolate hiring and wage trends in the broader economy. NFIB’s chief economist Bill Dunkelberg stated, “This summer has been challenging for many small business owners who are working hard to keep their doors open and remain in business.”

Prices at the wholesale level posted their largest increase in nearly two years last month, but inflationary pressures were still largely invisible in the economy analysts said.  The Producer Price Index (PPI) for final demand jumped 0.6% in July, the most since October 2018, and double the consensus of 0.3%.  Core PPI, or PPI ex-food and energy, rose 0.3%, also the most since October 2016, and above the consensus of 0.1%.  On an annual basis, the PPI for final demand was still down 0.4%, indicating inflation doesn’t appear to be an issue anytime soon.  Scott Brown, chief economist at Raymond James, stated, “Figures have been choppy in recent months, but there is no significant upward pressure on wholesale prices.”

At the consumer level prices jumped for a second month in a row, but as with prices at the producer level, overall inflation remains low.  The consumer price index rose 0.6% in July.  Economists had forecast a 0.4% advance.  The increase in consumer prices over the past 12 months, meanwhile, rose to 1% from 0.6% in June.  Just seven months ago, at the start of 2020, the yearly pace of inflation had climbed to as high as 2.5%.  Another closely watched measure of inflation that strips out food and energy also shot up 0.6% last month.  The increase in the core rate was the largest since 1991, but it follows a record decline.  The yearly increase in the so-called core rate moved up to 1.6% from 1.2%.

(Sources:  All index- and returns-data from Yahoo Finance; news from Reuters, Barron’s, Wall St. Journal, Bloomberg.com, ft.com, guggenheimpartners.com, zerohedge.com, ritholtz.com, markit.com, financialpost.com, Eurostat, Statistics Canada, Yahoo! Finance, stocksandnews.com, marketwatch.com, wantchinatimes.com, BBC, 361capital.com, pensionpartners.com, cnbc.com, FactSet.)