Desla's Weekly Market Update: July 29, 2024

Desla's Weekly Market Update: July 29, 2024

Economic Growth Surges as Tech Stocks Stumble: A Week of Market Volatility and Broadening Trends

 

Last week was another eventful week in the stock market. Below are some of the key developments:

 

GDP Growth

The US GDP for Q2 surpassed the forecast, coming in at 2.8% compared to the expected 2.0%. This indicates stronger-than-expected economic growth, providing a positive signal for the overall economy.

 

Inflation

Inflation data came in lower than anticipated, showing continued signs of cooling off. This development could ease concerns over rising prices and support economic stability.

 

Corporate Earnings

Corporate earnings presented a mixed picture among large companies, including Google, Tesla, and 3M. The market reaction to these earnings was notable:

 

• Google: The tech giant's earnings failed to impress, resulting in a sell-off.

• Tesla: Similarly, Tesla's earnings disappointed investors, accelerating the sell-off in technology & consumer discretionary stocks.

• 3M: In contrast, 3M experienced a massive 27% positive stock movement on Friday, highlighting a significant divergence in market reactions within the corporate sector.

 

Stock Market Performance

The US stock market experienced a turbulent week. The S&P 500 started strong but fell over 2% by the week's end, driven by a sharp sell-off in technology stocks. Despite this, the healthcare sector reached a 52-week high, another indication of broader market strength.

 

We believe the market broadening is here to stay, and sectors beyond technology may continue to hit new 52-week highs, even if the S&P 500 experiences declines. Furthermore, the S&P 500 is now outperforming the Nasdaq 100 index, proving that the market is broadening and other sectors continue to perform well despite the S&P's recent fall.

 

Looking ahead, investors are closely watching upcoming Federal Reserve decisions combined with ongoing earnings reports from major companies. Expect continued volatility in markets, investment rotation, and market broadening.

 

We continue to believe that our Tactical Growth strategy is suitable given the current market volatility and broadening trends. This strategy aims to navigate the complexities of the market by focusing on sectors poised for growth, providing a potentially strong approach to investing during these uncertain times.

 

For personalized investment advice or more details on our strategy, please contact us to learn about how we position our clients in these dynamic markets. Subscribe to our Insights page for further updates and insights as we continue to monitor market conditions and adjust our strategies accordingly.

 

 

This information is being provided for informational purposes only and is not intended as investment advice. For more information about our services and fees, please consult our Form ADV 2, which is available here: https://adviserinfo.sec.gov/firm/summary/310235 For a list of all recommendations we have made over the past 12 months, please contact us at 515-452-0001.