The Week on Wall Street
Stocks rose over the shortened trading week as investors digested developments in the Middle East while the Fed held short-term rates steady.
The Standard & Poor’s 500 Index rose 0.93 percent through Thursday’s close, while the Nasdaq Composite Index gained 2.43 percent. The Dow Jones Industrial Average climbed 0.71 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, advanced 0.96 percent over the same four-day period.1,2
Dow Hits 52,000
The week began with stocks rising and oil prices falling after the White House announced that the U.S. and Iran had reached an agreement over the weekend.
All three major averages climbed on Monday, ranging from 1 to 3 percent gains, while crude prices declined by roughly 5 percent.3
Tuesday was a split-screen performance. The Dow Jones Industrials rose to a record intraday high as oil prices fell, while the S&P 500 and Nasdaq slipped as investors rotated out of tech and into cyclical stocks such as banks and industrials. The Dow Industrials crossed the 52,000 threshold for the first time.4
The S&P and Nasdaq opened higher midweek as tech stocks recovered, and amid news that consumer spending unexpectedly rose in May. Investors also appeared to be in a risk-on mood as they awaited the Fed decision, confident that the Federal Open Market Committee (FOMC) would hold rates steady.5
Then, on Thursday, stocks rebounded, led by chipmakers and the AI trade. The S&P 500 capped its 11th winning week of the past 12.6
Fed Holds, Hints at Future Hike
As expected, the Fed held rates steady at its June meeting, keeping the Fed Funds Rate at a 3.5 to 3.75 percent target range.
This was the first FOMC meeting with newly minted Fed Chair Kevin Warsh. The Fed acknowledged the tick up in inflation this year, and Warsh reemphasized the Fed’s goal of a 2 percent inflation rate at the post-meeting press conference.7
Weekly Riddle
What force and strength cannot get through, it with gentle touch can do. People in many halls would stand were it not in their hand. What is it?
Last Week’s Riddle: Your mother’s brother’s only brother-in-law is taking a picture of you. How is he more closely related to you?
Answer: He is also your father.