Market Data as of Week Ending: 6/21/2024 unless noted otherwise
Most major equity indices ended the shortened trading week higher despite end-of-week softness. Year-to-date size and style trends reversed as breadth increased. Mid-cap stocks outperformed large-cap, and value outperformed growth. The S&P 500 reached new highs early in the week, but momentum faded as the technology sector traded lower. The broadening market helped push consumer discretionary stocks higher, which have underperformed most other sectors year-to-date. Developed foreign markets were flat for the week as concerns about European political uncertainty faded, and Eurozone economic data hinted at a slowing economy. Emerging markets traded higher despite weakness in Chinese stocks due to weaker-than-expected industrial production and continued lower house prices.
Bond prices were mixed for the week as yields declined on the short end of the curve but increased on the long end. The slight flattening of the yield curve helped short-term bonds outperform long-term bonds. The 10-year Treasury ended the week at 4.25%, and the two-year increased to 4.70%. High-yield bonds outperformed as credit spreads contracted slightly. Yields on corporates and high yield ended the week at 5.39% and 8.08%, respectively.
It was a light week for economic releases, but data supported the narrative of a strong economy with potential softness in consumer sentiment. The Census Bureau reported that retail sales in May increased by 0.1%, slightly below estimates, and retail sales in April were revised lower to a 0.2% decrease. Retail sales were 2.3% higher than in May 2023. The week was abundant with housing data that emphasized supply challenges. Housing starts were 5.5% lower in May and 19.3% lower than a year prior. Housing completions were 8.4% lower than the previous month but 1.0% higher than a year ago. The National Association of Realtors reported that home sales decreased by 0.7% in May, and the median existing home sales price increased to $419,300. May marked the 11th consecutive month of increases and the highest ever. The NAHB housing market diffusion index dropped to 43, the lowest level since December 2023. Homebuilders cited that higher interest rates and labor shortages continue to present challenges. The S&P Global Flash U.S. Composite PMI of 54.6 reached a 26-month high, highlighting the continued strength in U.S. businesses. While manufacturing remains strong, the services sector led the June expansion with a PMI of 55.1, also a 26-month high. The survey indicated that increased pressure on operating capacity has led firms to expand their workforce for the first time in 3 months. Meanwhile, the slower growth of input costs has reduced inflationary pressures.