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Hello, this is Ryan McGuire, Senior Consultant for Oak Wealth Advisors. This is our June 2023 market update. Despite ongoing concerns about potential recession, a tightening consumer and commercial credit environment, and uncertainty around the Federal Reserve’s strategy moving forward, stocks showed
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resilience in the second quarter. Corporate profits and an important measure of economic health have declined less than expected in 2023.
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The S&P 500 Index continues to rally impressively, returning 6.6% on the month. Both the pause in interest rate hikes from the Fed and the June debt ceiling deal undoubtedly aided markets.
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While mega cap technology stocks continue to have an outsize impact on returns year to date, the broader U.S. Market, including small cap and mid cap stocks, performed well in June.
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And despite the noted challenges, most sectors of the U.S. Market advanced for the month, except for energy and utility stocks.
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Turning the attention to international developed and emerging economies, those stocks also performed well in June, on average around 4-5%. A short look at the bond market reveals that U.S.
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Treasury yields have risen over the month and quarter, contributing to a slight decline in the broader aggregate bond market. Bonds on the whole are still up between 2-3% on the year.
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While the U.S. Government revised its first quarter annualized economic growth estimates upwards to 2%, the Eurozone registered its second straight quarter of economic decline, entering into a recession.
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On the inflation front, the U.S. Saw inflation rates continue to decelerate. It’s a different story in Europe, where inflation rates remain stubbornly high, leading central banks to raise interest rates in May and June.
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It’s interesting to note that even with these headwinds, stocks in the Eurozone still had a strong month for the most part in June and are performing well in the year.
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This underscores the concept that stock markets, which are forward-looking, typically move well in advance of the U.S. Economic events. We’ll continue to keep a close eye on these trends around the world markets.
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As always, feel free to reach out with any questions. Take care.