Wall Street's biggest monthly gain since 2020

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Wall Street's biggest monthly gain since 2020

All three US stock indexes posted weekly and monthly gains that are the highest in the last two years. A similar trend is present in the European stock markets. Thus, the S&P 500 ended July with a growth of 9.1 percent, which is its biggest monthly jump since November 2020, while the Nasdaq rose 12.3 percent, the most since April of the same year.

"The reports from Amazon and Apple supported the market, as these two large companies, which have a significant weight in the S&P, managed to navigate well through these difficult times," said Rick Meckler, a partner at Cherry Lane Investments.

Apple shares rose 3.3 percent after the company said chip shortages were easing and demand for its iPhones continued. At the same time, Amazon shares rose 10.4 percent as management said it expects third-quarter revenue to rise due to higher fees from its premium services.

The financial results are great so far

Overall, the financial results season has been great so far. Of the 279 companies whose shares are part of the S/P 500 index and which reported business results, 77 of them exceeded analysts' expectations with their earnings.

It is expected that the company's earnings will increase by 7.1 percent in the second quarter. There was also a positive mood on the European stock markets. Solid earnings from European companies have been supporting the good performance of stock markets for some time, so the pan-European STOXX 600 ended July with a gain of 6.3 percent, achieving its best monthly performance since November 2020.

“Markets may test the substantial rally that occurred last week as they consider the progress the Federal Reserve has made thus far to stem the course of inflation,” John Stoltzfus, Oppenheimer’s chief investment strategist, wrote in a note.

This week, investors have more economic data and company earnings to digest. The July nonfarm payrolls report from the Bureau of Labor Statistics will give more insight into the labor market. Solid jobs growth has led economists to say the U.S.

is currently not in a recession, despite two consecutive quarters of negative GDP. Earnings are due from Caterpillar, PayPal and Starbucks.