U.S. Economic and Market Highlights
- First quarter U.S. annualized Gross Domestic Product growth was revised downward to 2.0%, below the initial 2.3% estimate.
- Existing-home sales in the U.S. unexpectedly declined due to rising mortgage rates, higher prices, and low supply.
- Core Consumer Price Index, which excludes the volatile energy and food components, rose 2.2%.
- The thirty companies that make up the Dow Jones Industrial Average are the most highly exposed to the export markets which had weak performance early in June due to the threat of looming trade wars between the U.S. and most of its major trading partners.
- Emerging markets have been volatile so far this year because of trade concerns and political uncertainties in Italy, Brazil, Russia, and Turkey.
- Domestic stock markets rallied in the end of June as S&P 500 index closed the quarter with a positive return, after some trade tensions were relaxed between Washington and Beijing.
- Analysts in the U.S. are forecasting a continuation in robust earnings growth for the rest of the year with growth above 25% in each of the next three quarters.
- The Fed raised its short-term federal funds rate by 0.25% to the target range of 1.75%-2.00%. Other central banks in Japan, Europe, and England left their short-term rates unchanged.
- The U.S. 10-year Treasury yield declined early in June on trade concerns and then increased toward the end of month to yield slightly higher at 2.87%.
- The difference between the 2-year U.S. Treasury Note yield and the 10-year U.S. Treasury Note yield finished June at 0.30%, its narrowest level in more than a decade, resulting in a flattening yield curve.
- U.S. Treasuries, agencies, investment grade corporate bonds and emerging market bonds all posted negative total returns over the past 12-month period ending May 31.
The above was prepared for informational purposes only and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security/instrument or to participate in any trading strategy. Past performance is not indicative of future results. Analysis done in cooperation with Cedar Hill Advisors.