It Was A Winning Week All Around -- Literally. All 11 S&P 500 Sectors Finished Higher; The Major Indices All Finished Higher; And The Value Stocks As A Class Finished Higher As Did The Growth Stocks.
At this juncture, it will surprise no one to hear that the mega-cap stocks as a class also finished higher.
It was a fitting end to a month that saw the market-cap weighted S&P 500 break out above 4,200... then 4,300... and then 4,400 before settling the quarter at 4,450. The Nasdaq Composite for its part recorded its best first half (+31.7%) since 1983!
This week had it all going on.
There was a reported coup attempt in Russia (which ended almost as quickly as it began).
There was a batch of encouraging economic data (May Durable Goods Orders, June Consumer Confidence, May New Home Sales, Weekly Initial Jobless Claims, the upward revision to Q1 GDP, and the May Personal Income and Spending).
There were reminders from Fed Chair Powell, ECB President Lagarde, and BoE Governor Bailey that more tightening will likely be needed to bring down inflation.
There was a batch of IPOs (yes, you heard that right).
There was the release of the Federal Reserve's annual bank stress test results, which all 23 banks taking the test passed.
There were earnings results -- some good and some bad -- from the likes of Carnival Corp., Walgreens Boots Alliance, General Mills, Micron, and Nike.
The constant through it all was an unshaken belief that the U.S. economy can avoid a recession and that the Federal Reserve is close to being done raising rates. That perspective underpinned the broad-based buying interest.
Notably, the sectors that were relative laggards this week were the countercyclical consumer staples (+0.6%), health care (+0.6%), and utilities (+0.7%) sectors. To be fair, communication services (+0.4%) was the least strong of all, having been pressured by a 1.7% decline in Alphabet, which was downgraded at UBS on Monday and at Bernstein on Tuesday.
Real estate (+5.0%) and energy (+4.8%) were the best-performing sectors this week followed by materials (+4.0%), industrials (+3.9%), financials (+2.9%), information technology (+2.9%), and consumer discretionary (+2.5%).
The Treasury market had a different experience, digesting another round of new supply and the bullish behavior of the stock market that might have spurred some asset reallocation trades. The 2-yr note yield increased 13 basis points this week to 4.88% while the 10-yr note yield rose eight basis points to 3.82%.
As a reminder, the stock market will be closing early at 1:00 p.m. ET on July 3 in observance of Independence Day. Markets will be closed on Tuesday, July 4.
Nasdaq Composite: +2.2% for the week / +31.7% YTD
S&P 500: +2.3% for the week / +15.9% YTD
S&P Midcap 400: +4.3% for the week / +7.9% YTD
Russell 2000: +3.7% for the week / +7.2% YTD
Dow Jones Industrial Average: +2.0% for the week / +3.8% YTD