A look back
- Stocks extended their gains with the S&P 500 up 0.9% to notch its eighth-straight positive week. Small caps rallied 2.6% to outperform, while international developed markets gained 2.2%.
- Interest rates remain elevated with the 30-year yield closing at its highest level since 2007 on Tuesday. Rates took a breather later in the week and the curve flattened, with the 2-year yield climbing to 4.12% and the 10-year dropping modestly to 4.55%.
- As earnings season nears its end, Nvidia was the last of the Magnificent Seven to release results. With 94% of S&P 500 companies having reported, the index is on track for 28.4% year-over-year earnings growth, its highest rate since Q4 2021.
A look ahead
- Inflation will be in focus with Core Personal Consumption Expenditures (PCE), the Federal Reserve’s preferred measure, set to be released on Thursday. Higher core inflation has been a driver of rising interest rates, with futures markets currently pricing in a more than 50% chance for a rate hike before the end of the year.
- Beyond inflation, investors will watch the first revision to Q1 GDP, expected to grow 2.0% year-over-year. Elsewhere, there will be a smattering of tech and consumer-focused earnings reports.
- Economic releases: Consumer Confidence Index, Core PCE, Q1 GDP, New Home Sales.
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