Stocks on Wall Street tumbled on Friday, with the sliding into a correction after a weaker than expected July jobs report stoked fears that the economy is headed toward a recession.
For the week, the benchmark and blue-chip both lost 2.1%, while the tech-heavy Nasdaq Composite slumped 3.4%.
Source: Investing.com
The week ahead is expected to be another eventful one as investors continue to gauge the outlook for the economy and interest rates.
The economic calendar is light, with the release of the latest jobless claims figures likely to garner most of the attention. There will also be some Fedspeak, with district governors Mary Daly and Tom Barkin set to make public appearances.
Source: Investing.com
Meanwhile, the pace of earnings slows down, though quarterly updates are still expected from notable companies such as Walt Disney (NYSE:), Super Micro Computer (NASDAQ:), Palantir (NYSE:), Uber (NYSE:), Shopify (NYSE:), Robinhood (NASDAQ:), Airbnb (NASDAQ:), Caterpillar (NYSE:), and Rivian (NASDAQ:).
Besides that, in the healthcare sector, Eli Lilly (NYSE:), the company that manufactures Zepbound and Mounjaro, and Novo Nordisk (NYSE:), which manufactures Ozempic and Wegovy, both step into the earnings confessional.
Regardless of which direction the market goes, below I highlight one stock likely to be in demand and another which could see fresh downside. Remember though, my timeframe is just for the week ahead, Monday, August 5 – Friday, August 9.
Stock to Buy: Eli Lilly
I expect a strong performance from Eli Lilly this week, as the pharmaceutical giant will likely deliver another quarter of solid top-and bottom-line growth and provide an upbeat outlook thanks to robust sales of its diabetes and obesity drugs.
The Indianapolis, Indiana-based healthcare juggernaut is scheduled to release its second quarter earnings report before the U.S. market opens on Thursday at 6:45AM ET.
Market participants expect a sizable swing in LLY stock after the update drops, according to the options market, with a possible implied move of roughly 8% in either direction. Earnings have…
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