“Overall, consumers are no longer bracing for the worst-case scenario for the economy feared in April,” when Trump announced his stunning set of worldwide tariffs, according to Joanne Hsu, director of the University of Michigan’s surveys of consumers. “However, consumers continue to expect both inflation and unemployment to deteriorate in the future.”
On Wall Street, UnitedHealth Group jumped 12 per cent after famed investor Warren Buffett’s Berkshire Hathaway said it bought nearly 5 million shares of the insurer during the spring, valued at $US1.57 billion ($2.4 billion). Buffett is known for trying to buy good stocks at affordable prices, and UnitedHealth’s halved for the year by the end of July because of a run of struggles.
Berkshire Hathaway’s own stock slipped 0.4 per cent.
Applied Materials helped lead Wall Street lower with a decline of 14.1 per cent even though it reported better results for the latest quarter than analysts expected. The focus was on the company’s forecast for a drop in revenue during the current quarter.
Its products help manufacture semiconductors and advanced displays, and CEO Gary Dickerson pointed to a “dynamic macroeconomic and policy environment, which is creating increased uncertainty and lower visibility in the near term, including for our China business.”
Sandisk fell 4.6 per cent despite reporting a profit for the latest quarter that blew past analysts’ expectations. Investors focused instead on the data storage company’s forecast for profit in the current quarter, which came up short of Wall Street’s.
All told, the S&P 500 fell 18.74 points to 6,449.80. The Dow Jones Industrial Average rose 34.86 to 44,946.12, and the Nasdaq composite sank 87.69 to 21,622.98.
In stock markets abroad, indexes rose 0.8 per cent in Shanghai but fell 1 per cent in Hong Kong after data showed China’s economy may have slowed in July under pressure from uncertainty surrounding Trump’s tariffs.
“Chinese economic activity slowed across the board in July, with retail sales, fixed asset investment, and value added of industry growth all reaching the lowest levels of the year. After a strong start, several months of cooling momentum suggest that the economy may need further policy support,” ING Economics said in a market commentary.
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Japan’s Nikkei 225 jumped 1.7 per cent after the government said its economy grew at a better-than-expected pace in the latest quarter.
In the bond market, the yield on the 10-year Treasury rose to 4.31 per cent from 4.29 per cent late Thursday. The two-year Treasury yield, which more closely tracks expectations for Fed action, rose to 3.75 per cent from 3.74 per cent late on Thursday.
AP
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