The S&P 500 edged lower on Thursday as investors paused after a record-setting rally, weighing mixed corporate earnings alongside renewed uncertainty over the Strait of Hormuz. Despite the pullback, Polymarket traders continue to expect the benchmark index to rebound at Friday’s open ahead of the closely watched July jobs report.
The S&P 500 slipped 0.18% to close at 7,709.96, after extending its recent run to an intraday high before fading into the close. The Aug. 7 Polymarket contract implied a 67% probability that the index will open higher on Friday.
Why That Number Matters
Wall Street continues to see the broader backdrop as constructive despite Thursday’s pullback.
The Aug. 6 Polymarket contract generated roughly $72,747 in trading volume, marking another increase in participation from the previous session as traders positioned ahead of Friday’s pivotal jobs report.
Although the S&P 500 ended lower, the decline was modest compared with the Dow’s 0.85% drop, suggesting investors largely paused after this week’s powerful rally rather than abandoning risk assets altogether.
The Bull Case
Semiconductor stocks are on track for their strongest week since May, helping revive confidence after July’s sharp momentum unwind, while strong corporate earnings have reinforced optimism that artificial intelligence spending continues to generate attractive returns.
Fundstrat’s Tom Lee told CNBC on Thursday that investors could soon begin chasing equities higher again. “There’s going to be a chase,” Lee said.
“I think that chase takes us towards 7,900, 8,000 this month.”
Many investors also remain hopeful that negotiations between the U.S. and Iran will ultimately lead to the reopening of the Strait of Hormuz, easing pressure on oil prices and inflation.
Friday’s July nonfarm payrolls report now becomes the week’s biggest catalyst. Economists expect the U.S. economy to have added 83,000 jobs, with the unemployment rate holding at 4.2%. Investors will also watch wage growth and labor force participation for clues on whether the Federal Reserve may need to keep interest rates higher for longer.
S&P 500 futures rose 0.13% early Friday.
How The Previous Bet Played Out: The Aug. 6 Polymarket contract ultimately resolved “Up” as the S&P 500 opened above Wednesday’s close.
Image: Shutterstock
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