The Week In Review: 7/8/2024

“We do not inherit the Earth from our Ancestors, we borrow it from our Children.” – Crazy Horse

Good Morning,

We hope everyone had a great Independence Day week!

The markets continue to rise as we anticipate more inflation news this week…CPI, a potential cease fire in the Middle East, and the beginning of the 2Q earnings season have our attention.

There is much to digest as we listen to the Fedspeak following the CPI report on Thursday and try to ascertain the probability of a Fed rate cut in September.

The CME FedWatch Tool is now predicting a 70.8% probability of a ¼ point cut in September, but that is quite a way off.

Not everyone is Bullish…

In spite of the market gains so far in 2024, there are plenty of Bears around calling for a rather dramatic correction in the not-too-distant future.

Marko Kolanovic, JP Morgan’s top market strategist, is calling for a 23% drop by year end in the S&P 500. Source: Yahoo.com

Worthy of note is that he has been Bearish all of 2024… and stayed Bullish in 2022 as the S&P tumbled 19%+. He has some company in his pessimism… but markets seldom fall when strategists are predicting it.

If we look at the Equal Weighted S&P 500, the market has done little since the peak in 2021.

A handful of Tech Stocks have fueled the Market Weighted S&P 500 to a gain of almost 17% thus far in 2024. Diversified portfolios such as the equal weighted S&P 500 are up only 3.92% YTD.

So, we come back from holiday, and we get back to work…

Have a wonderful week!!

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