Stocks continued to trade in a very narrow range for the second half of the month. On June 16th, the Federal Reserve (Fed) concluded their regularly scheduled meeting and announced that while they expect higher inflation, there is no plan to make “immediate” changes to interest rates or the current asset purchase program. However, the Fed did address the possibility of raising interest rates in 2023 – a significant announcement since all previous Fed guidance was no interest rate hikes until 2024. The same day, Janet Yellen told the Senate Finance Committee that the “…current bout of inflation is expected and will be short-lived.”
June 17th saw a surprise increase to initial jobless claims. While the expectation was that claims would continue to drop, the number of claims actually topped 400,000.
Inflation concerns and jobless claims numbers drove markets down for the week. Since then, however, the markets have been steadily, albeit modestly, gaining. The Standard and Poor’s 500 (S&P 500) and NASDAQ Composite Index (NASDAQ) both rose to new record closes in the second half of the month..
As of June 30th, cumulative returns for the second half of the month were positive for all major markets. The Dow gained 203 points (0.59%) and the S&P 500 rose 51 points (1.2%). The NASDAQ was the big winner, rising 431 points (3.06%). The S&P 500 posted several new all-time highs over the period and the NASDAQ also hit several new record closes – the first time since late April.