Global equity markets finished higher for the week. In the U.S., the S&P 500 Index closed the Week at a level of 5,615, representing an increase of 0.89%, while the Russell Midcap Index moved 3.10% last Week. Meanwhile, the Russell 2000 Index, a measure of the Nation’s smallest publicly traded firms, returned 6.01% over the Week. As developed international equity performance and emerging markets were higher, returning 2.29% and 1.83%, respectively. Finally, the 10-year U.S. Treasury yield moved lower, closing the week at 4.18%.
The consumer price index fell by 0.1% in June on a month-over-month basis, marking the first time in over four years that the inflation rate dropped. The monthly print would also bring the year-over-year inflationary rate to 3%. When excluding volatile prices of food and energy, the core reading showed inflation at 3.3% annually, which was still below the 3.4% forecast by economists. While the Fed targets 2% annual inflation, the June CPI report suggests that prices are trending in the right direction.
Traders increased the probability of a September rate cut following the report. The CME FedWatch tool indicated that markets are pricing in an initial cut in September and possibly more by year-end. Additionally, the Labor Department reported a decrease in weekly jobless claims to 222,000, the lowest level since June 1, with continuing claims slightly lower at 1.85 million.
Equity Market, Fixed Income returns, and rates are from Bloomberg as of 7/12/24 Economic Calendar Data from Econoday as of 7/15/24. CME FedWatch tool chart sourched from the CME group on 7/15/24. International developed markets are measured by the MSCI EAFE Index, emerging markets are measured by the MSCI EM Index, and U.S. Large Caps are defined by the S&P 500 Index. Sector performance is measured using the GICS methodology.
Disclosures: Past performance does not guarantee future results. We have taken this information from sources that we believe to be reliable and accurate. Hennion and Walsh cannot guarantee the accuracy of said information and cannot be held liable. You cannot invest directly in an index. Diversification can help mitigate the risk and volatility in your portfolio but does not ensure a profit or guarantee against a loss.