- The University of Michigan’s consumer sentiment index unexpectedly fell this month.
- Buying conditions for durables continue to worsen.
- The first regional manufacturing report of the month (from the NY Fed) shows signs of improvement as demand stabilizes.
- The federal deficit was wider than expected in May.
- Federal interest payments now exceed the defense budget.
- Many investors anticipate the first Fed rate cut to occur in September, with the market assigning approximately a 66% probability to a rate reduction that month.
- US retail sales growth was well below forecasts in May.
- Last month, manufacturing output exceeded forecasts, rebounding after two consecutive months of declines.
- A majority of investors do not expect a US recession over the next 18 months.
- The total mortgage activity has been down sharply from the 2021 levels, but first-time buyer share has been rising.
- Metropolitan areas that have experienced an influx in population growth since mid-2022 have responded with an increase in housing supply, although rental affordability has deteriorated in some of these areas.
Market Data
- US indices look overbought. Are we due for a pullback?
- The top-weighted S&P 500 stocks continue to make new highs while the majority of constituents are losing upside momentum.
- The S&P 500 dividend yield continues to decline.
- Here is a look at the year-end forecasts for the S&P 500 (currently at 5,487).
- Performance of “Tesla killer” EV companies compared to their all-time highs:
- Declining birth rates:
- It has been 333 trading sessions since the S&P 500 last experienced a 2% decline in a single day., …
- … or a 2.5% decline in the Nasdaq Composite.
- Tech valuations are at the highest level since the dot-com bubble.
- Earnings growth for mega-caps is expected to decelerate, aligning closer to the S&P 500 median.
Great Quotes
“Conformity gets you nowhere.” – Neil Strauss
Picture of the Week
Iceland
All content is the opinion of Brian Decker
