US Equity Markets posted mixed results last week on directionless trading, though mega-cap tech stocks generally returned to their winning ways. The S&P 500 increased 0.8% for the week and is now up 14.8% for the year. The S&P 500 Equal Weight index continues to underperform, down fractionally for the week and only up 4.2% for the year. The Nasdaq rose 2.3% for the week on the strength in technology stocks to bring its gains for the year to 29.9%, while the Russell 2000 (small cap stocks) was down 0.3% for the week and is now up 5.3% for the year.
Increasing inflation concerns out of Japan and ongoing economic issues in China hurt Global Equity Markets last week. Developed Markets fell 0.2% for the week and are now up 4.0% for the year. Emerging Markets lost their remaining gains for the year, down 0.5% for the week. For the year, Emerging Markets are now down 0.4%.
US Interest rates held steady last week despite a speech from Fed Chairman Powell suggesting ongoing efforts to tame inflation. The yield on the benchmark US 10-Year Treasury closed the week at 4.23% vs. 4.25% the prior week. Investors believe there is only a 20% probability the Fed raises rates at its next meeting in September, though odds are 47% for a Fed rate hike in November.
Of Interest to Us
Mortgage demand from homebuyers fell to a 28-year low as interest rates continue to rise. Mortgage rates for both conforming loans and non-conforming loans hit 23-year highs with rates well in excess of 7%. Applications for mortgages hit their lowest level since December 1995 as potential buyers grapple with high rates, high prices, and limited supply.
for the week ending 8/25/2023
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