Schwab Trading Activity Index™: Score Moves Slightly Higher During the July Period, Remaining at Moderate Levels
August 05 2024 - 12:30PM
Business Wire
Schwab clients were net buyers in July,
increasing their exposure to technology-related names associated
with semiconductors, cloud computing and the Consumer Discretionary
sector
The Schwab Trading Activity Index™ (STAX) increased slightly to
54.81 in July, up from its score of 54.71 in June. The only index
of its kind, the STAX is a proprietary, behavior-based index that
analyzes retail investor stock positions and trading activity from
Schwab’s millions of client accounts to illuminate what investors
were actually doing and how they were positioned in the markets
each month.
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Schwab Trading Activity Index July 2024
(Graphic: Charles Schwab)
The reading for the four-week period ending July 26, 2024, ranks
“moderate” compared to historic averages.
“The July STAX period ended with U.S. equity markets appearing
little changed – but looks can be deceiving. July saw significant
volatility, attributable to both geopolitical and technical
factors,” said Joe Mazzola, Head Trading & Derivatives
Strategist at Charles Schwab. “Indices continued reaching new
heights during the first half of the period, stretching valuations
and investor expectations in advance of the second quarter earnings
season. The second half of the month saw nearly all those gains
relinquished, as volatility rose markedly. On a sector basis,
clients bought most in Information Technology and Consumer
Discretionary, while selling was most pronounced in Financials,
Health Care, and Industrials.”
The CBOE Volatility Index (VIX) spiked by as much as 55% during
the period and closed 31.75% higher at 16.39; levels not seen since
April. Additionally, on July 24, both the Nasdaq Composite and
S&P 500 logged their worst day since 2022, ending the S&P
500’s streak of over 360 trading days without a 2% sell-off.
On July 5, the U.S. Bureau of Labor and Statistics’ Employment
Situation Summary showed nonfarm payrolls increased by 206,000 in
June, beating the consensus estimate of 190,000. The unemployment
rate edged higher once again to 4.1%. The Consumer Price Index
(CPI) came in at 3.0%, just below expectations, while the Producer
Price Index (PPI) of 0.2% was slightly higher than expected. On
July 25, initial jobless claims of 235,000 were reported, reversing
a recent trend of misses to the upside as compared to expectations.
Core Personal Consumption Expenditures (PCE) were reported at 2.9%
versus expectations of 2.7%, and Q2 GDP increased at an estimated
annual rate of 2.8% versus real Q1 GDP of 1.4%; the increase was
primarily driven by consumer spending and increases in business and
inventory investments.
The 10-year Treasury yield spiked to as high as 4.49% intraday
on July 1, and moderated to close the period at 4.2%. The U.S.
Dollar Index fell by 1.46%, closing the period at 104.32, and front
month Crude Oil Futures fell by 5.37% to close the July STAX period
at $77.16 per barrel.
Popular names bought by Schwab clients during the period
included:
- NVIDIA Corp. (NVDA)
- Chipotle Mexican Grill Inc. (CMG)
- Broadcom Inc. (AVGO)
- Amazon.com Inc. (AMZN)
- Alphabet Inc. (GOOG/GOOGL)
Names net sold by Schwab clients during the period included:
- Tesla Inc. (TSLA)
- AT&T Inc. (T)
- Palo Alto Networks Inc. (PANW)
- Exxon Mobil (XOM)
- Boeing (BA)
About the STAX
The STAX value is calculated based on a complex proprietary
formula. Each month, Schwab pulls a sample from its client base of
millions of funded accounts, which includes accounts that completed
a trade in the past month. The holdings and positions of this
statistically significant sample are evaluated to calculate
individual scores, and the median of those scores represents the
monthly STAX.
For more information on the Schwab Trading Activity Index,
please visit www.schwab.com/investment-research/stax. Additionally,
Schwab clients can chart the STAX using the symbol $STAX in either
the thinkorswim® or thinkorswim Mobile platforms.
Investing involves risk, including loss of principal. Past
performance is no guarantee of future results.
Content intended for educational/informational purposes only.
Not investment advice, or a recommendation of any security,
strategy, or account type.
Historical data should not be used alone when making investment
decisions. Please consult other sources of information and consider
your individual financial position and goals before making an
independent investment decision.
The STAX is not a tradable index. The STAX should not be used as
an indicator or predictor of future client trading volume or
financial performance for Schwab.
About Charles Schwab
At Charles Schwab, we believe in the power of investing to help
individuals create a better tomorrow. We have a history of
challenging the status quo in our industry, innovating in ways that
benefit investors and the advisors and employers who serve them,
and championing our clients’ goals with passion and integrity.
More information is available at aboutschwab.com. Follow us on
X, Facebook, YouTube, and LinkedIn.
0824-HA04
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version on businesswire.com: https://www.businesswire.com/news/home/20240805350691/en/
At the Company Margaret Farrell
Director, Corporate Communications (203) 434-2240
margaret.farrell@schwab.com
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