Dow holds onto records, shrugging off China’s slowing economy

Dow futures are pointing at a higher open on Monday, as stocks are sticking to their records highs.

The Dow, the S&P 500 and the Nasdaq Composite all closed at all-time highs on Friday, finishing a week with a total of six records combined.

This winning streak could continue on Monday. Futures are up 0.2% across the board, suggesting that the three indexes will open above Friday’s record closes.

A 27-year low in Chinese GDP growth couldn’t knock futures either.

The health of China’s economy has repercussions for global growth and is closely watched by investors. Nevertheless, traders shrugged the data point off.

China’s economy expanded at a pace of 6.2% year-over-year in the second quarter, its slowest quarterly growth rate since 1992. Despite the dramatic headline number, the slowdown was expected.

President Donald Trump tweeted in response, saying “the United States tariffs are having a major effect on companies wanting to leave China for non-tariffed countries.” That is why Beijing wants to make a deal with Washington, he added.

A closer look at the data reveals that “on the back of more government stimulus, June headed towards a slight recovery on several fronts,” wrote Björn Giesbergen, senior economist at Rabobank. China has pledged it would support its economy multiple times over the past months.

While China’s GDP growth slowed, retail sales for June beat consensus expectations and rose 9.8% on the year.

Aside from macroeconomic factors, investors are turning their attention to second quarter results, as earnings season will kick off in full swing this week. As usual, big banks go first and Citigroup was leading the pack on Monday. The bank beat earnings estimates and its stock climbed 1.1% in premarket trading.