Markets saw opportunities this week for a rally. Could this growth cycle be picking up steam?
Monday
S&P 500 0.96% | NASDAQ 0.94%
Markets responded optimistically as hopes of a cease fire between Israel and Iran came closer to a reality. Here in the U.S., a Federal Open Market Committee (FOMC) member indicated the stage was being set for lowering interest rates (dovish tone).
Tuesday
S&P 500 1.11% | NASDAQ 1.43%
Tech Stocks surged on Tuesday following increased chances of a rate cut while oil quickly fell on the cease fire brokered in the Middle East. The former has been the beneficiary of gains lately as we look towards the back half of the year.
Wednesday
S&P 500 0.00% | NASDAQ 0.31%
The S&P500 was flat on the day while the tech sector continued its run. Home sales dropped double digits in the month of May. Optimism surrounding rate cuts could soon boost the beleaguered real estate market. Late summer buying activity and lower interest rates could certainly change the landscape in the next month or two.
Thursday
S&P 500 0.80% | NASDAQ 0.97%
Semi-conductor stocks continued to get a bounce as easing tariff concerns with China and accommodative rate-environment boosted outlook. The S&P500 benefited from the rally as several larger technology companies are in the index.
Friday
S&P 500 0.52% | NASDAQ 0.52%
The week ended with zero “red-days” as stocks rallied through the close again on Friday. Consumer Sentiment has improved dramatically as tariff concerns have not hindered market prospects as much as we saw 2 months ago.
Conclusion
S&P 500 3.44% | NASDAQ 4.25%
Markets put on a show this week as there were no signs of slowing down from the beginning. A cease fire deal, cooling inflation projections, and rate cut optimism contributed to a meaningful rally as indexes flirted with their all-time highs. Sentiment has improved since early April, Volatility has declined since early May, and June is about to close with the S&P500 up almost 9% for the 2nd quarter and the Nasdaq up close to 16% for the same period. With the first half of the year almost in the books, there is increasing positivity on this mid-level growth cycle keeping its momentum. Several Federal Open Market Committee members have expressed support for a rate cut. Companies and individuals benefit from declining borrowing costs, which was most notable for the technology sector this week. GDP for the 2nd quarter remains strong and corporate earnings will begin to roll out in the next couple of weeks.
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