This week’s roundup covers the data behind the headlines. The Atlanta Fed’s GDPNow model moved its Q2 tracking estimate up to 1.7%, and while the headline figure looks soft, real final sales to private domestic purchasers are growing at 3%. Bank of America card data showed household spending up 6.3% from a year ago, the strongest reading since April 2022. On the market side, every US sector is trading above its 200-day moving average, S&P 500 earnings growth excluding technology sits at multiyear highs, and bank valuations have recovered to a post-crisis high. You will also find June’s inflation readings, which cooled more than expected, and the latest labor market indicators heading into the Fed’s blackout window.

 

US Economy

 

The Atlanta Fed’s GDPNow model is now tracking Q2 GDP at 1.7%, up from 1.3% on July 7.

While the headline figure looks weak, the underlying details are stronger. Growth of real final sales to domestic purchasers, which exclude the volatile inventories and net trade components, is solid at 2.8%. Further excluding government spending, real final sales to private domestic purchasers are estimated to have grown by 3%.

Bank of America’s internal data also showed that spending per household increased by 6.3% year over year in June, the strongest growth rate since April 2022. Lower gasoline prices reduced spending on essentials in June, with discretionary purchases accounting for most of the growth in consumer card spending.

Wage growth for higher-income households eased, while that of the lower-income cohort improved, closing the gap.

Here’s a look at both trailing and forward profit margins by sector.

 

 

What are the highest-paying college majors for new graduates?

 

 

Identical plant and animal fossils found across now-distant continents provide compelling evidence that the landmasses were once joined before plate tectonics separated them.

 

 

What are the richest economies based on average and median wealth?

 

 

What do the US and China buy from each other?

 

 

Which states produce the most food in the US?

 

 

This map shows the average cost of living by state.

 

 

US Stock Market

 

Every US sector is trading above its 200-day moving average. The outperformance of the technology sector in the current cycle has been unusually strong and prolonged.

Earnings revision momentum remains strong.

 

Source: UBS Research

 

Even when excluding the technology sector, the market’s forward EPS growth is at multiyear highs.

 

Source: Piper Sandler

 

The price/book ratio for the KBW Banks Index has recovered to a post-Global Financial Crisis high.

 

Source: John Arthers   Read full article

 

This chart puts the surge in semiconductor stocks into historical context. The semiconductors and semiconductor equipment subsector was the most net-bought by Goldman’s prime brokerage clients last week.

 

Source: BCA Research via Reuters   Read full article

 

The Fed

 

Inflation showed broad-based cooling, surprising to the downside. Gasoline prices slumped by the most since August 2022. In contrast, overall food inflation edged up. Ground beef prices stayed above $7 per pound for the third consecutive month. Shelter inflation also eased. The Fed Mandate Surprise Index (the sum of inflation and labor surprises), constructed by Piper Sandler, is turning down, foreshadowing a potential softening in the Fed’s hawkish tone. Markets sharply scaled back expectations of a July Fed rate hike.

Fed Chair Kevin Warsh said AI-driven price increases are not necessarily inflationary, arguing they reflect a one-time supply adjustment likely to be offset by productivity gains rather than persistent inflation.

 

Jobs

 

Most indicators show either soft or balanced labor market conditions. Accordingly, Oxford Economics believes that the labor market isn’t on the verge of overheating or adding to inflationary pressures. The decline in US labor force participation largely reflects statistical distortions from updated population estimates, with the participation rate essentially unchanged between June 2025 and May 2026 after adjusting for the break in the series.

 

Great Quotes

 

“I am the greatest. I said that even before I knew I was.”

– Muhammad Ali

 

Picture of the Week

 

North Carolina Blue Ridge Parkway Sunrise Asheville, NC

 

 

 

All content is the opinion of Brian Decker