Most of the major markets ended the first week of August higher. The Nasdaq composite was the top domestic index again this week but it was still below the gains seen in the emerging market index.
Last week was marked by the fact that the S&P 500 managed to break the narrow daily closing change streak. After 12 consecutive trading days in a row with the closing daily change under a half percent point, positive or negative, the S&P 500 closed with a loss of -.64% on Tuesday. This is the longest, narrow closing range since September of 1995. The rest of the week was quiet leading up to Friday’s Employment Situation report.
To say that the results were a surprise is an understatement as the 255,000 Nonfarm Payroll month over month change well exceeded the consensus range of 150,000 to 215,000 for July. Furthermore, June and May were also revised upward. Both the Work-force Participation Rate and the Unemployment Rate managed to creep up a tenth of a percent as more Americans were deemed to be in the workforce.
But as mentioned earlier, it was actually the Emerging market index that had the largest gains on the week. This index has also been the best performer of the major markets YTD. The MSCI EM index continued the YTD gains to 11.5% this week due to significant gains in Poland, Indonesia, Taiwan, and Brazil.
Brazil and Rio De Janeiro specifically has been in the news a lot leading up to the 2016 Summer Olympics which began on Friday. Rio beat out Chicago, Tokyo, and Madrid back in October 2009 when the International Olympic Committee announced Rio as the winner. But since October 2009, The Brazil Index has fallen 74% from 3310.60 to the low of 859.87 on January 21st of this year.
Many commentators have commented how the financial strains of Brazil have been visible leading up to the games. Yet, the Brazil Index has managed to climb an amazing 61.57% YTD.
While the roots of the Olympic games harken back to the Ancient Greeks, the modern day Olympics as we know them were created by Baron Pierre de Coubertin when he founded the International Olympic Committee (IOC) in June of 1894.
It’s amazing how much these games have grown since their founding. If you happen to tune in to watch, you won’t be alone. It’s estimated that nearly half of the world’s population will watch some portion of the games over the next few weeks