Market Summary – May 28, 2024

Last Week’s Summary

  • S&P 500 Index rose 0.05%
  • International Equities fell 1.03%
  • Emerging Markets fell 1.48%
  • U.S. 10-Year Treasury Yield rose to 4.46%
  • U. of Mich. Sentiment rose to 69.1
  • U. of Mich. 1 Yr. Inflation fell to 3.3%
  • Initial Jobless Claims fell to 215k

What to Watch for This Week

  • T, 5/28/24 Conf. Board Consumer Confidence
  • W, 5/29/24 MBA Mortgage Applications
  • Th, 5/23/24 GDP Annualized, Core PCE, Initial Jobless Claims
  • F, 5/24/24 PCE Deflator, Personal Income, Personal Spending, MNI Chicago PMI

Weekly Market Recap

Stocks rose after data showed American consumers tempered their inflation expectations, bolstering sentiment regarding the prospects for Federal Reserve rate cuts this year. The S&P 500 rebounded after a two-day slide, reclaiming the 5,300 mark and erasing this week’s losses in a session of low trading volume.

The Nasdaq 100 hit a fresh all-time high, led by gains in Nvidia Corp. and Apple Inc. Treasuries barely moved after Fed Governor Christopher Waller stated that he still believes the neutral interest rate is relatively low but warned that unsustainable fiscal spending could change that trend.

The Fed’s preferred inflation measure, the core PCE deflator, is due next Friday and is expected to show the slowest monthly increase this year. Swaps now fully price in the Fed’s first full quarter-point rate cut for December, rather than November.

Growth in activity at service providers was the fastest in a year, and manufacturing output expanded at a quicker pace. Such economic resilience is making it difficult for inflation to cool, which helps explain why the Fed is intent on keeping rates higher for longer.

When traders return from the holiday weekend, the “T+1” rule will come into effect, reducing the settlement period for U.S. equities from two days to one.

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