Here’s why the S&P 500 might not hit 2,000 next week
Next week is the last unofficial week of summer, but that doesn’t mean you should let August doldrums get between you and your portfolio. Yahoo Finance’s very own Lauren Lyster, Milanee Kapadia, Michael Santoli and editor-and-chief Aaron Task are here to bring you information on what you should be expecting next week, August 25th through 29th.
Watch the pump—
Next week ends in Labor Day weekend which means more Americans will be hitting the roads than usual, in fact this Labor Day will see the largest amount of travel in six years, according to the AAA. With 86% of the estimated 34.7 million travelers expected to drive to their destination, gas will be in high demand. Good news though, prices are lower. AAA has estimated gas in the U.S. will round out at about $3.44 per gallon—it was $3.59 per gallon last Labor Day.
“The best part of this story,” says Milanee Kapadia, “is that the low price isn’t because of lower consumer demand, it’s because of increased supply, especially here domestically.” U.S. crude oil production in 2015 is expected to hit its highest level since 1972.
“Lower prices at the pump equate to a tax cut, it’s putting more money back in the consumers wallets,” says Kapadia.
August consumer confidence data will be released Tuesday, August 26 at 10:00am. “Last month it was the highest level since 2000– there’s a dislocation though. Consumer confidence, is up but spending hasn’t picked up as well,” says Yahoo Finance editor-in-chief Aaron Task. “So will consumers put their money where their mouths are? That’s going to be a big question next week and certainly something the Fed’s going to be keeping its eye on.”
Task points to Williams-Sonoma (WSM), Abercrombie and Fitch (ANF) and Dollar General (DG), as companies that are all reporting next week. These companies, he says, will also give us a sense of where the American consumer is.
S&P 500 (^GSPC)—
This seems like a moment of truth for the markets, says Yahoo Finance’s Michael Santoli. “Right now as the S&P approaches 2000 it seems like a logical point to have some kind of a pause or reassessment because we’ve got most of what we expected,” he says. “We got the snapback in the economic numbers for the second quarter, we have the reaffirmation of dovishness from the Fed, and I feel like we’re not going to have a lot of new information to feed off of.”
Santoli is looking to see if the internal momentum of the market is enough to bring the S&P higher than 2000. His prediction is that the S&P will cross the threshold but not without resting and settling back first.