PUT IN WORK (6/17/2024)

The stock market had a stellar week—arguably its best week in months. Stocks skyrocketed several times throughout the week, most notably on Tuesday and Wednesday, the days of the Fed meeting. We’ll get into why that might be, but regardless, investors pushed indices to new heights. The S&P 500 (SPY) rose by 1.6% and the Nasdaq (QQQ) jumped an incredible 3.5%. Both indices have reached new all-time highs, with the Nasdaq even closing the day out at its highest point.

Momentum is high right now, a fact made evident by the last four trading days. Every trading day last week—save for Monday—saw indices hit all-time highs repeatedly, one after the other, pushing ever higher until Friday’s close. While the Fed meeting might seem less than favorable based solely on the fact that rates remained unchanged, the Fed’s explicit statement regarding one very likely rate cut before the end of the year bolstered investors’ spirits. This was compounded by the CPI report that occurred the prior day, which showed that inflation slowed more than expected for May: 3.3% compared to the widely anticipated 3.4%.

Another important note regarding the market’s performance is Apple (AAPL). On Tuesday, all investors watched as Apple held its 2024 Worldwide Developers Conference. This time, the focus was on AI—and investors knew that. The event alone drove Apple’s stock price 10% higher by Friday’s close, but on Tuesday, shares had briefly reached $220—a whopping 14% jump. Meanwhile, despite Nvidia’s (NVDA) stock split, the company’s shares continue to climb higher and higher. All of these factors are coming together and pushing stocks higher, and although we’re happy to see this positive movement, we’re careful not to get too complacent.

(Nasdaq ETF (QQQ) price from June 2023 - 2024 — each candle is 1 week. Chart provided by tradingview.com.)

PORTFOLIO UPDATE

Unfortunately, many of our stocks were either flat or inched downward by the end of the week. A personal theory is that many small caps didn’t take well to the news that there may only be one rate cut by the end of 2024, unlike the rest of the market. The Russell 2000 (RUT) ended the week down 3.7%, the downward move starting the day of the Fed’s inflation reading, so it would make sense. Regardless, we plan to hold all currently owned stocks for the foreseeable future. As always, thank you for reading, and happy investing.