Weekly Market Drivers | LPL Financial Research

Stocks Take a Breather After Strong Start to June

US: S&P 500 Index +0.5%, Dow +0.5%, Nasdaq +0.7%
Europe: STOXX Europe 600 +0.4%, German DAX +0.4% France CAC 40 +0.1%, U.K. FTSE 100 +0.2%
Asia: Japan Nikkei +1.1%, China Shanghai Composite +1.9%, Korea KOSPI +1.2%
Rates/Commodities: 10-Year Treasury yield +1 basis points to 2.09%, WTI crude oil -2.9%, COMEX gold: -0.1%

U.S. stocks stalled this week after posting their biggest weekly gain since November. The S&P 500 Index rose modestly in the week as investors struggled to find direction in trade headlines and conflicting economic reports. The U.S. announced a trade deal with Mexico over the weekend, propelling the S&P 500 to its best gain of the week on Monday.

Data showed business optimism climbed to a seven-month high in May, and retail sales increased for the third straight month. Still, Consumer Price Index and Producer Price Index reports indicated wholesale price and consumer inflation slowed, reflecting the U.S.-China trade dispute’s growing strain on demand.

Global stocks rose for a second straight week, encouraged by trade prospects after the United States rescinded tariff plans for Mexico. Chinese stocks posted their best week since April as investors cheered more stimulus, despite President Trump’s threat to raise tariffs again if President Xi does not meet with him at the G-20 Summit later this month.

“Stocks have stabilized for now, but they aren’t in the clear yet,” said LPL Chief Investment Strategist John Lynch. “The next two weeks could be pivotal for the global economy as the Federal Reserve (Fed) meets and the G-20 Summit takes place.”

In the upcoming week, investors will be watching the Fed as it concludes a two-day meeting with a policy decision on June 19. Policymakers are scheduled to provide updated rate and economic projections at the conclusion of the meeting. We’re not expecting the Fed to change its policy rate, but we do expect to get valuable commentary on the Fed’s thoughts about global uncertainty and the future of policy. The Bank of Japan will also meet next week, and Markit is scheduled to release preliminary manufacturing data for several global regions. Track these and other important events on our Weekly Global Economic & Policy Calendar.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.

All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. All performance referenced is historical and is no guarantee of future results.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

This Research material was prepared by LPL Financial, LLC.

Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).

Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL is not an affiliate of and makes no representation with respect to such entity.

Not FDIC or NCUA/NCUSIF Insured | No Bank or Credit Union Guarantee | May Lose Value | Not Guaranteed by Any Government Agency | Not a Bank/Credit Union Deposit


For Public Use | Tracking # 1-863720 (Exp. 06/20)