Stock Market Today: S&P Sets Another New High to Kick Off Q3

Stocks got off on the right foot for the second half of 2021, rising Thursday after another encouraging unemployment-filings report.

First-time jobless claims for the week ended June 26 fell by 51,000 filings to 364,000 – that's lower than estimates for 388,000 claims, and a fresh low since COVID was declared a pandemic.

"This morning's beat on jobless claims is a real bright spot," says Cliff Hodge, chief investment officer at wealth management advisor Cornerstone Wealth. "Not only did we print the lowest number since the pandemic began, but it also reverses the trend on misses that we've seen the past few weeks. Staying below that big-round-number 400k level could bolster confidence in risk taking during the dog days of summer."

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But the day's gains were far from balanced – energy stocks such as ConocoPhillips (COP, +3.2%) and EOG Resources (EOG, +3.2%) led the way on the back of a 2.4% rise in U.S. crude oil futures to $75.23 per barrel.

Technology (+0.1%) was flattish, however, and consumer staples (-0.3%) actually posted a small decline.

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The end result for the major indexes, though, was a fresh high for the S&P 500 Index (+0.5% to 4,319), and gains for both the Dow Jones Industrial Average (+0.4% to 34,633) and Nasdaq Composite (+0.1% to 14,522).

Other action in the stock market today:

• The small-cap Russell 2000 rose 0.8% to 2,329.
• Krispy Kreme (DNUT) had a disappointing start in its return to the public market, opening at $16.30 per share – lower than its initial public offering (IPO) price of $17, which was marked well below the planned range of $21 to $24 per share. The doughnut maker gained some traction during the session, though, settling right at $21.00. In other IPO news, trading app Robinhood today filed its paperwork to go public. While no date was indicated for its debut, the company will trade on the Nasdaq under the ticker "HOOD."
• Walgreens Boots Alliance (WBA) was the worst Dow stock today, sliding 7.4% after earnings. The drugstore chain reported better-than-expected adjusted profit and revenues in its fiscal third quarter and boosted its full-year guidance, due in part to increased traffic from those getting COVID-19 vaccines. Concern that slowing vaccination rates could negatively impact revenue was being cited by some as a reason for today's selloff.
• Gold futures tacked on 0.3% to settle at $1,776.80 an ounce.
• The CBOE Volatility Index (VIX) retreated 2.2% to 15.48.
• Bitcoin prices fell 4.9% to $33,095.95. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.

What Can We Expect in Q3?

Well … the past sends mixed signals.

"Historically, stocks are weak during the third quarter, something to be aware of as we turn the calendar to July. The S&P 500 Index has gained only 0.7% on average during the third quarter, the worst of the calendar year," says independent broker-dealer LPL Financial.

"It has closed green 62% of the time, though, in line with Q1 and Q2. The big reason why the average is worse is some spectacular crashes have taken place during this quarter. Here's the catch … stocks have gained 8 of the past 9 third quarters."

Investors don't need to resign themselves to flattish returns, however.

Fund investors might want to take a gander at these five mutual funds that have earned a five-star rating from research firm CFRA – a grade that suggests a high likelihood of outperforming their broader asset category over the next 12 months.

You could also leave your stock-picking choices to the machines. Since the start of the year, we've been keeping an eye on stocks picked by Danel Capital's artificial intelligence platform, and it continues to build an impressive market-beating track record. The system doesn't make buy-and-hold calls, however – instead, it spies stocks it thinks can outperform over the course of a few months, making it most appropriate for those who like to mix a few small, tactical trades into their portfolios.

Read on if you're curious about which stocks Danel's AI platform has its eye on for the rest of the summer.