Weekly Market Bullets

for the week ending 7/12/2024

• US Equity Markets rose last week on positive inflation data and Fed Chairman Powell's testimony to Congress that suggested the next move in rates will be lower. The S&P 500 increased 0.9% for the week to bring its gains for the year to 17.7%. The Nasdaq was up 0.3% for the week and is now up 22.6% for the year, while the Russell 2000 (small cap stocks) surged 6.0% for the week on the prospect of lower rates to bring its gains for the year to 6.0%.

• Global Equity Markets rose last week on better-than-expected economic growth in Europe and a pick-up in exports from Asia. Developed Markets increased 2.3% for the week and are now up 7.8% for the year. Emerging Markets were up 1.7% for the week to bring its gains for the year to 9.8%.

• Positive inflation data result in higher expectations for Fed rate cuts. The Consumer Price Index (CPI) through June was up 3.0% from a year ago, better than expected and down from 3.3% in May. Core CPI, which excludes food and energy prices, rose 3.3% from a year ago, also better than expected and down from 3.4% in May. As a result, the yield on the US 10-Year Treasury dropped to 4.18% from 4.28% the prior week. The Street now believes the Fed will cut rates 3 times before the end of the year, up from 2 times the prior week, with an 88% chance of a rate cut at its meeting in September.

• A record-low percentage of stocks are outperforming the S&P 500. While last week was a strong week for the "average" stock, we recently hit a record low for the percentage of stocks in the S&P 500 that are actually beating the index. Only about 23% of stocks are beating the S&P 500. The prior record low was hit back in 1980 with only about 26% of stocks beating the index.

Market Data

for the week ending 7/12/2024