WEEKLY MARKET UPDATE 6/28/2024

The S&P 500 finished the first half of 2024 with strong gains as the index rose roughly 15%.  Stocks continued to be propelled by a small group of companies, however, as the Dow Jones Industrial Average is up less than 5% and the average S&P 500 stock has underperformed that index by roughly 11 percentage points - the biggest gap in the first half of a year since 1990 (per Dow Jones Market Data).  Nonetheless, since 1950 the S&P 500 has finished the first half of a year up double-digit percentages twenty-three times and in every instance, the index has finished the year positive with an average full year return of 25.1% (per Carson Investment Research).  Next week will be a short one due to the Fourth of July market holiday, but it will be chock full of economic data headlined by the June jobs report on Friday.

COOLDOWN IN HOME PRICES?

The value of the median existing home rose to a record $419,300 in May, up from $270,000 before the pandemic (per NAR), but we are finally starting to see some signs of a cooling housing market.  For the first time since the beginning of the pandemic, for example, the typical house sold in June for slightly less (-0.3%) than its asking price according to Redfin.  Furthermore, inventory is starting to build with total active listings per Realtor.com now 35% higher than twelve months ago and the supply of new homes at more than 16-year highs.  To be clear, the housing market is far from crashing, but some slack in shelter prices would be a welcome development for markets if it translates to less inflationary pressures.

Ian G. Browning, CFA
Managing Director, Investment Strategies | Shareholder

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