Valley Peak Newsletter: June 19th

Looking Back:
As we step into the third week of June, markets are navigating a blend of optimism and caution. Here’s a snapshot of recent developments and their implications.

Equities:
This past week, stock markets showed mixed performance. The S&P 500 rose 1.6%, buoyed by positive earnings and optimistic economic data. The technology sector, particularly Nvidia and Apple, continued to draw attention. Nvidia’s strong performance in AI and Apple’s announcements at its developers’ conference contributed to the gains. Meanwhile, European markets were subdued by inflation worries and recent central bank rate cuts. Asian markets showed resilience despite ongoing concerns over China’s economic data.

Bonds:
In the bond market, the U.S. 10-year Treasury yield fell slightly to 4.2%, boosting bond prices. While the Fed signaled early in 2024 they would lower interest rates later this year, investors are losing confidence in this approach.

Commodities:
Commodity markets displayed typical volatility. Brent crude prices rose above $78 per barrel, driven by geopolitical tensions and strategic production decisions by OPEC+. Gold held steady around $1,955 per ounce, balancing safe-haven demand against a strengthening dollar.

Economic Data:
In the U.S., May’s CPI inflation reading came in at 3.3%, a decline from previous months. Employment data remained robust with 272,000 new jobs, but there was a slight uptick in unemployment to 4%.

Looking Forward:
The theme for this week could be “measured optimism.” Significant upcoming events include retail sales data, housing starts, and further central bank meetings. Staying informed and adaptable will be key. Our goal is to navigate these conditions thoughtfully, making the most of the opportunities while managing the risks.

Feel free to reach out if you have any questions or need further insights. Wishing you all a great week ahead!

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