In a holiday shortened week the S&P 500 was down just over 1%, closing Friday at 4398. With the markets only open a half day on Monday, the S&P 500 made a new 52 week high on the lightest volume since last Thanksgivings Black Friday. Tuesday was the 4th and we hope everyone enjoyed it. On Wednesday the June FOMC minutes were published, essentially echoing what was said in the last Fed decision, that being expect two more rate hikes. Before Thursdays open, the June ADP jobs report showed that private sector companies added 497,000 jobs, more than double expectations and the largest increase since July 2022. This caused a gap open to the downside, the 2-year Treasury briefly reaching a 16-year high of 5.12%, and the S&P 500 unable to recover to its opening price. Before Fridays open the June employment report showed that nonfarm payrolls rose by 209,000, its lowest reading since December 2020. Also, the unemployment rate came in at 3.6%, down from 3.7% in May. In the morning the markets gained ground but could not hold on to those gains as it sold off going into the close. From a technical perspective, the markets have the characteristics of a consolidation period, similar to what we saw in May. If you look at the S&P 500s Bollinger Band Index, it lies just above the mid-point and the width has been shrinking since 21 June. So when might we see a breakout to the upside like June? Next week we get inflation numbers, which are forecast to be lower on an annual basis. This may not drive market action now but will certainly influence the last week of July. Thats when it will be busy with both the Fed decision meeting and Mega Cap earnings reports. For TSP TIPS, the C fund also made a new 52 week high on Monday and stands at the top of the Performance Ranking leaderboard with the S fund closing the gap. As such, we recommend no changes to our current investment mix.
In a holiday shortened week the S&P 500 was down just over 1%, closing Friday at 4398. With the markets only open a half day on Monday, the S&P 500 made a new 52 week high on the lightest volume since last Thanksgivings Black Friday. Tuesday was the 4th and we hope everyone enjoyed it. On Wednesday the June FOMC minutes were published, essentially echoing what was said in the last Fed decision, that being expect two more rate hikes. Before Thursdays open, the June ADP jobs report showed that private sector companies added 497,000 jobs, more than double expectations and the largest increase since July 2022. This caused a gap open to the downside, the 2-year Treasury briefly reaching a 16-year high of 5.12%, and the S&P 500 unable to recover to its opening price. Before Fridays open the June employment report showed that nonfarm payrolls rose by 209,000, its lowest reading since December 2020. Also, the unemployment rate came in at 3.6%, down from 3.7% in May. In the morning the markets gained ground but could not hold on to those gains as it sold off going into the close. From a technical perspective, the markets have the characteristics of a consolidation period, similar to what we saw in May. If you look at the S&P 500s Bollinger Band Index, it lies just above the mid-point and the width has been shrinking since 21 June. So when might we see a breakout to the upside like June? Next week we get inflation numbers, which are forecast to be lower on an annual basis. This may not drive market action now but will certainly influence the last week of July. Thats when it will be busy with both the Fed decision meeting and Mega Cap earnings reports. For TSP TIPS, the C fund also made a new 52 week high on Monday and stands at the top of the Performance Ranking leaderboard with the S fund closing the gap. As such, we recommend no changes to our current investment mix.