1h24 in the Books
Index, Sector & Asset Performance
The S&P 500 gained about +15% in 1H2024 with artificial intelligence, “AI”, semiconductor chip supplier, Nvidia responsible for more than a third of that gain. The maker of AI chips gained over +150% year to date to become the most valuable company in the US at one point. Technology and communication services stocks have maintained their leadership and have been the best asset class through mid-2024. These two sectors are up close to +30% in the S&P 500 after posting gains of more than +50% in 2024. On an equal-weight basis, the S&P 500 is up about +4% versus +15% for the overall index. All of the other sectors are posting slight to moderate gains so far this year.
Entering 2024, many macro investors expected the Federal Reserve to cut interest rates five to six times. So far, that’s a big zero, as there hasn’t been any interest rate cuts by the Fed. The S&P 500 notched 31 all-time closing highs over the first 6 months of 2024 making it the second-best total post 2000. Stocks have rallied on strong earnings in the technology and telecommunications sectors, a stable economy, and investing momentum focused in AI investments.
The price weighted, Dow Jones 30 Index, has gained about +4% year to date, the same return as the equally weighted S&P 500. Dow 30 components Nike, Intel, and Boeing were all down more than -30% in the first half of 2024.
Economic Indicators and Earnings Commentary
Clues from the first Presidential debate.
Following the presidential debate last Thursday, the prediction markets made a major shift in probabilities in favor of a Trump win. A Trump win would likely lead to a stronger USD dollar, particularly in the event of a wider Republican victory in Congress. Longer term Treasury yields rose last week even with the weaker PCE inflation data on Friday with bond investors likely concerned about higher deficits in 2025 and beyond from either lower taxes or higher spending or both.
Data this week includes ISM manufacturing index today, the JOLTS job openings report on Tuesday, and the employment report on Friday. June FOMC meeting minutes are released on Wednesday. For once, with the holiday shortened week, there are a few Fed members speaking.
Boeing will acquire its supplier Spirit AeroSystems for $37.25 per share in all stock.
Global Market Trends/Commodities/Currencies
Your chocolate bars likely cost you more in 1H2024 as cocoa prices continued to soar over +80% due to weather and supply shortage concerns. Gold hit new record highs over $2400 an ounce. The Japanese yen dropped to a 38-year low against the US dollar. Bitcoin rose on the back of new ETF launches.
Japan was the winner on the week while European markets continued to sell off.
OHFG Exclusive Data & Charts
Oak Harvest Weekly Stock Talk: Stock Markets 1H24- Everyone’s a Winner? Not.
