FMI - JUNE 2024 NEWSLETTER

FMI MARKET UPDATE

The better part of May was spent cleaning up the mess that April made. While it wasn’t “white-glove-test” clean, it was at least “the-in-laws-are-coming-to-visit” clean. The Fed left rates unchanged on May 1st, which came as no surprise, but something rather unexpected happened during Chair Powell’s press conference that afternoon – Powell’s answers during the Q&A session came across surprisingly optimistic, which laid the foundation for a very nice recovery. To add a little more fuel to the fire, non-farm payrolls came in significantly lower than expected AND the CPI report came in lower than expected, both signs that the Fed’s plans seem to be working – and the market believed.

The Dow Jones Industrial Average had a decent month and, at one point, closed above 40,000 for the first time ever. YTD, the DJIA is +2.65%. The broader S&P 500 experienced a strong rally in May, increasing its YTD gain to +10.64% and the tech-heavy NASDAQ Composite followed suit with a YTD gain of +11.48%, slightly outperforming the S&P.

Crude Oil continued to decline as inventories swelled in the face of lower-than-expected demand, especially considering Memorial Day weekend traffic. Still, crude oil boasts a YTD gain of +7.76%. Gold marched upwards on the heels of rate cut hopes for 2024, showing a respectable gain of +12.93% YTD. Bitcoin bounced around $70,000, a very important technical level, and continues to be one of the best performing assets YTD at +53.02%.

The month of June is going to be very interesting. The Fed meeting coincides with the CPI report on the 12th, which will make the rate decision and the following Q&A all the more volatile. Expect significant market movement on that day. In addition, now that summer has finally arrived, fueling stations will likely switch to their summer-blend gasoline, which is, unfortunately, a tad more expensive. That said, we expect prices at the pump to increase over the next several weeks. The market seems extra murky when volatility hits, but the further out you look, the clearer the path becomes. If you have questions about your account, please reach out to your advisor.