John Hancock: Weekly Market Recap Week Ended June 28

Top-heavy market

The first half of 2024 produced lopsided results across the U.S. equity market. Through June 26, a single information technology sector stock contributed around 30% of the overall total return of the S&P 500, according to S&P Dow Jones Indices. In addition, just five tech-oriented stocks accounted for more than half of the index’s year-to-date total return.

Inflation eases

The U.S. Federal Reserve’s preferred inflation gauge moved closer to the Fed’s long-term inflation target of around 2.0%. Excluding energy and food prices, the core Personal Consumption Expenditures Index rose at an annual rate of 2.6% in May, marking the slowest price growth in more than three years. 

Q2 earnings expectations

Expectations are positive heading into earnings season, which opens in mid-July as major banks begin reporting second-quarter results. As of June 21, analysts surveyed by FactSet were expecting companies in the S&P 500 to post an average earnings increase of 8.8% compared with the same period a year earlier—potentially the fourth consecutive quarter of year-over-year earnings growth.

Jobs ahead 

A monthly labor market report due out on Friday will show whether May’s acceleration in jobs growth was an anomaly or the start of a trend. In May, the economy generated a better-than-expected 272,000 jobs, up from the 165,000 jobs added in April. May’s wage growth also exceeded expectations.  

Source: https://wmr.jhinvestments.com/