SPX: S&P 500 Clocks Fourth Monthly Gain, Scores 35% Increase Since April’s Meltdown

Tariffs just can’t put a dent into the stock market. The broad-based benchmark wrapped August up 1.9% and traders are hungry for more. Here’s what’s next.

🏆 Record August with a Weak Finish

• The S&P 500 index (SPX) dipped 0.6% Friday, as traders took profits ahead of the long Labor Day weekend (stocks are closed Monday), but the monthly performance remained solid at 1.9%, securing the fourth straight monthly gain. Last week, the broad index logged its latest all-time high, climbing past 6,500.
• The Nasdaq Composite IXIC slipped 1.1%, weighed down by tech pulling back, while the Dow Jones Industrial Average DJI shed 92 points, or 0.2%, after touching record levels earlier in the week.
• August’s rally was powered by strong earnings, Nvidia’s NVDA blockbuster results, and easing rate-cut optimism. However, the Core PCE inflation print on Friday reminded investors the fight against sticky prices isn’t over yet.

🔥 Inflation Still There – Buy Up?

• The Core Personal Consumption Expenditures USPCEPI price index – the Fed’s preferred inflation gauge – rose 2.9% year-over-year in July, up from June’s 2.8%. That matched forecasts but still underscores persistent cost pressures.
• Investors are betting tariffs won’t cause runaway inflation, despite higher costs on consumer products. Instead, markets seem convinced that corporate pricing power and healthy demand will help absorb price increases – at least for now.
• For context, the S&P 500 has surged 35% since April, when Trump introduced reciprocal tariffs. Remember “Liberation Day?” That marked the market’s bottom – and investors have since leaned heavily into growth and AI-fueled tech plays.

👾 A Monster Week of Data Incoming

• Tuesday: ISM Manufacturing PMI and ISM Manufacturing Prices for August — key insights into US factory activity and cost pressures.
• Wednesday: JOLTS job openings report, giving traders a read on labor demand and wage inflation dynamics.
• Thursday: ADP private payrolls alongside the ISM Non-Manufacturing PMI and Prices data. These ones are critical for gauging labor market trends.

💥 Friday’s Big Bang

• Friday’s main event: US Nonfarm Payrolls USNFP for August. Wall Street expects 78,000 new jobs, up from July’s 73,000.
• Revisions matter, too, especially after what happened last time. May and June’s data quietly wiped off 258,000 jobs from prior tallies, signaling a cooler labor market than originally thought and strengthening the case for rate cuts.
• Unemployment is expected to tick up to 4.3% from 4.2%, which, if confirmed, would add pressure on the Fed to deliver a cut in September.