WSJ Poll Shows Wave of Support for Kamala Harris
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A new Wall Street Journal poll shows a dead heat between Donald Trump and Kamala Harris. Here's the thing that screams out to me about the entry of Kamala Harris into this race. It's enthusiasm.

Both parties show more than 80% of people within their party saying they're enthusiastic about their candidate. I mean, that in itself is the proverbial vibe shift. And the latest U.S. inflation data keeps the door open for a September interest rate cut. Plus, the junk stocks in your index fund could be costing you big time.

It's Friday, July 26th. I'm Jennifer Maloney for The Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that moved the world today. U.S. inflation broadly met expectations in June and remained above the Federal Reserve's 2% target, keeping the door open for an interest rate cut in September.

The Department of Commerce said its personal consumption expenditures inflation gauge rose 2.5% in June compared to a year earlier. Excluding volatile food and energy prices, PCE inflation rose 2.6%, the same as in May. ♪

Investors today continue to spread their bets beyond the big tech firms that have powered stock indexes to new heights. Every industry sector in the S&P 500 ended the day higher in a broad rebound from what had been a rocky week on Wall Street, including a midweek tech sell-off.

The Dow Jones Industrial Average rose 1.6% and ended the week up 0.7%. The S&P 500 increased 1.1%, but notched a weekly decline of 0.8%. The Nasdaq Composite rose but finished the week 2.1% lower. And the Russell 2000 continued its resurgence, adding 1.7% today. The index of smaller companies has risen for three straight weeks.

Stock indexes like the S&P 500 are an easy and popular way to invest. But most of us don't pay attention to what's under the hood. And there could be junk stocks hiding in there, dragging down our returns. Wall Street Journal Heard on the Street columnist Spencer Jacob is here to explain.

Spencer, first off, what is a stock index? I'm an investor and I don't know what stock to pick. So one of my options is a stock index, right? It's a very good option. I mean, index funds tend to, over the years, beat the majority of active fund managers. And one reason they do that is that they are very low cost. And so that's a good thing. But it matters how they're constructed. And to

two that I looked at were two small cap indexes. Small caps have been on fire recently. They've trounced larger stocks, the Magnificent Seven and stuff like that. And the most popular index by far is the oldest one, which is the Russell 2000, which basically just, they take the market, they say, what are the thousand biggest stocks? Okay, that's the Russell 1000. What's the next 2000? That's the Russell 2000. And everything else is a micro cap below that.

But that you kind of wind up sweeping up a lot of junky stuff when you do that. And you can see the effect of that. And people are quite surprised that the Russell 2000, which was the kind of the gold standard, it's done okay. But it hasn't done as well as things that have the same thing on the label that just have a different methodology. I want to go back to basics, just kind of set the scene, just in really basic terms. What is a stock index? It's

It's like a collection of stocks that are supposed to track the market, right? Yeah. There literally are a thousand times as many indexes as there are stocks that you can buy in the world. The markets have been sliced and diced every which way. The most famous one is the Dow, which has existed since the late 1800s. And that's a very clunky one. There are gatekeepers, including editors of the Wall Street Journal, who decide what goes into it.

And it's supposed to be representative of American industry, basically. It does an okay job at doing that, but there's a lot of human judgment that goes into it. Then there's the S&P 500, which is the most tracked index in the world. It's existed for decades, not as long as the Dow. And that one is not exactly, but roughly the 500 largest American companies in order. And then there are some that...

try to own almost the entire market. The really popular one is by Vanguard. There are all kinds of indices there, but they all have little quirks and little problems. And the more followed they are, the more problems show up. Which stock indexes did you look at? The thing that I wrote about for the paper today was specifically about small caps, where there's a very substantial difference between an index that requires a company to be profitable to enter and one that doesn't.

Since 1994, it's more than 700 percentage points difference between the two indexes, even though they have the same thing on the label, basically. So people assume they're pretty similar and interchangeable. So what's your advice for regular investors? Should we give up on index funds? Absolutely not. Index funds have saved individual investors hundreds.

hundreds of billions of dollars over the years since they've become popular. The only problem is that sometimes they're too popular and sometimes they're clunkily or poorly constructed. But generally speaking, I would not steer people away from index funds. I would just have them do a little bit of research in terms of how it's constructed. And these days, as I said at the beginning, there's so many indexes that you can buy something that's a little quirky, that has a twist, that's

that seems to have helped over time may or may not work going forward. But if you own something that is a little bit unusual, then you avoid some of the pitfalls that the really popular indexes have. Spencer Jacob is The Wall Street Journal's global editor for Heard on the Street. Coming up, a Wall Street Journal poll shows waves of enthusiasm for both Donald Trump and Kamala Harris. That's after the break. ♪

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A new Wall Street Journal poll shows the presidential race between Kamala Harris and Donald Trump is essentially tied after President Biden announced he wouldn't run for re-election. The survey shows Trump leading Harris 49% to 47% in a two-person matchup, within a 3.1 percentage point margin of error. Trump held a six-point lead over Biden earlier this month before Biden exited the race and endorsed his vice president, Kamala Harris.

Aaron Zittner is a reporter and editor for The Wall Street Journal, and he joins me now. Aaron, what's the big takeaway for you from this poll? Well, Joe Biden's problem all year had been that he's bleeding Democrats.

Black voters, young voters, Latino voters who have been part of the Democratic coalition were walking away from Joe Biden when he was at the top of the ticket. This poll shows that Kamala Harris has gone a substantial way toward reassembling the Democratic coalition that elected Joe Biden. She's not fully there yet, but the fact that she has brought home this coalition that was fraying

is the reason why what had been a six-point lead for Donald Trump just earlier this month against Joe Biden is now a two-point lead on a head-to-head ballot. And when we ask people about a ballot that has Robert F. Kennedy Jr., another third party and independent candidates,

Donald Trump's lead is only a single point. That's essentially tied. But do keep in mind that the election is decided in swing states. And traditionally, a Democrat has to be not within shouting range of the Republican. The Democrat tends to have to be ahead by three or four percentage points in these national numbers in order to have enough heft to

left to pull the candidate along, the Democrat along, in the swing states. So a tie usually means that the Democrat is behind in the swing states. This is a measure of the national electorate, of course, not the swing states. But that's something to keep in mind when you look at these numbers.

So this is a measure of the popular vote, but the popular vote does not decide the election. That's right. But let me tell you something that, you know, we talk in these polls about young voters and white voters and black voters. Here's the thing that screams out to me about the entry of Kamala Harris into this race. It's enthusiasm.

When we ran a poll just a few weeks ago, before the last three weeks that had basically a year's worth of political events in them, there was a crazy lopsided, disparate feeling about the candidates within these two parties.

Something like 70 percent of Republicans said that they were enthusiastic about their candidate. But only 37 percent of Democrats in our poll earlier this month said they were enthusiastic about their candidate. Just an incredible mismatch on enthusiasm. In this poll, the two parties are tied on enthusiasm.

Both parties show more than 80% of people within their party saying they're enthusiastic about their candidate. I mean, that in itself is the proverbial vibe shift. That's a big, big change. And yeah, we can talk about gains that Kamala Harris has made. And by the way, there are strong numbers for Trump in this poll too. But that enthusiasm boost is just the thing that to me screams out about what is different in this moment than just a few weeks ago.

What will you be looking for in the next poll that could give us a better idea of where we're headed? Well, Kamala Harris isn't even the Democratic nominee yet. She's the expected nominee. There's a lot to play out here in the election. And we don't know whether this initial burst of enthusiasm among Democratic constituencies or groups that tend to, you know, usually be Democratic will hold and whether it'll be enough to pull Democrats out of what has been a substantial hole in

so far in this election. So, you know, there's a lot to learn. But there's another thing here we have to talk about, Jennifer, and that's that this poll has some of the best numbers that we've seen for Donald Trump. He's ahead in both the head-to-head ballot and a ballot with six different candidates on it. But when we ask people, do you have a favorable view of this candidate or an unfavorable view?

People have a favorable view of Donald Trump more than they do of Kamala Harris. And this is the most favorable that we've seen for Donald Trump in our polling, I think, ever in the last two years.

Also, when we ask people, what do you think about the job that Donald Trump did as president? He's now got more people saying they approve of his performance as president than disapprove. It's narrow, 51% approved, a 48% disapprove. But that's the strongest job performance for Donald Trump that we've seen. So what we see in this poll is maybe it's the effect of the convention. There's usually a bounce.

for the candidate who's nominated at his party's convention, or I guess her party's convention. Could be a post-convention bounce, could be the effect of the assassination attempt, or it could just be that voters are warming up more than before to Donald Trump. But he shows more strength and higher favorable ratings than we've seen in other recent journal polls. Aaron Zittner is a reporter and editor at The Wall Street Journal.

From heat waves to flooding rains, there's been a lot of extreme weather this summer. How have you been affected by extreme weather? And what questions do you have about the things companies are doing to counter those effects? Send a voice memo to WNPOD at WSJ.com or leave a voicemail with your name and location at 212-416-4328. We might use it on the show.

Federal prosecutors today charged famous short seller Andrew Left with fraud. They accused him of making exaggerated or misleading statements about stocks and quickly profiting on price moves caused by his reports. An indictment returned by a Los Angeles grand jury accused Left of essentially trading on his name and reputation, announcing his bets and naming price targets far from where a stock was trading.

The indictment says that Left quickly closed his positions after his statements caused prices to move in the direction he wanted. Left is a bombastic investor who named his firm Citrin Research because it analyzes the quote-unquote lemons of the stock market. He had no immediate comment when he was reached this morning. An attorney for Left said the cases are based on a defective theory and unfairly target Left for legitimate opinions and trading activity.

And finally, the Olympics are officially underway. This edition of the games will feature some pretty out there competitions like break dancing. And outside of the mainstream Olympics, some health buffs are taking wellness to another level, competing in a leaderboard called the Rejuvenation Olympics. Participants take blood tests to measure their so-called pace of aging. Basically, that's how fast their body is aging biologically every year.

The test is issued by True Diagnostic, the same company that manages the competition. Personal health reporter Alex Janin looked into how this race for youthfulness is a money-making enterprise. These companies certainly stand to benefit from all of the hype around aging and longevity. So True Diagnostic, they say you have to buy a True Diagnostic test in order to be considered. And it's

Brian Johnson, who's sort of the face of the competition and came up with the idea, also stands to benefit financially with his company Blueprint because his name and face are all over this. And he's selling supplements. He's selling his famous nutty pudding. He's selling shirts that say don't die. And then finally, there are other companies remarking on the success of this venture by True Diagnostic.

and considering partnering with other, mostly non-profits in the longevity space to launch their own sort of competing versions of this leaderboard. But Alex says the world of aging and longevity is often plagued with claims that are hard to back up. Doctors and researchers who study aging caution that biological age tests are far from perfect and don't capture everything that affects biological age.

And that's What's News for this week. Today's show was produced by Pierre Bien-Aimé and Anthony Bansi. I'm Jennifer Maloney. Our AM host is Luke Vargas. Additional support this week from Francesca Fontana and Sabrina Siddiqui. Michael LaValle wrote our theme music.

Thank you.

Tomorrow, you can look out for our weekly markets wrap-up, What's News in Markets. Then on Sunday, we'll be answering your questions about the U.S. national debt and what it means for the country and for you. That's in What's News Sunday. We'll be back with our regular show on Monday morning. Thanks for listening.