Weekly Economic Update – 06/25/2024

The Week on Wall Street

Stocks edged higher over the four trading days last week, with the three major averages taking turns leading based on various economic and artificial intelligence (AI) news.

The Dow Jones Industrial Average rose 1.45 percent–its best week since May–while the Standard & Poor’s 500 Index gained 0.61 percent. The Nasdaq Composite, which has led all year, ended flat. The MSCI EAFE Index, tracking developed overseas stock markets, rose 0.94 percent for the week through Thursday’s close.1

Mixed Economic News

All three averages began the week with gains, including new highs for the S&P 500. However, stocks posted only modest gains on Tuesday as mixed economic data came in. Retail sales rose 0.1 percent—less than expected, although better than in April when sales fell.2,3,4

Markets were closed for the Juneteenth holiday on Wednesday.

As the week ended, it was the Dow’s turn to lead as sentiment shifted on mega-cap tech names as investors again questioned the sustainability of AI market drivers. Home prices hit a new high in May—this, paired with high mortgage rates, caused existing home sales to fall for the third consecutive month.4,5

A Notable AI Driver

Some investors and market analysts are examining the underlying long-term drivers of AI more closely, given its outsized impact on market averages like the S&P 500 and Nasdaq.

One such underlying driver is “DRAM”: Dynamic Random Access Memory, the AI-turbocharged version of a RAM semiconductor, more commonly referred to as “memory chips.” Companies making DRAM chips are an essential part of the AI ecosystem. Expect attention to shift to prominent DRAM players as they report earnings in Q2.6

Weekly Riddle

At a stop sign on a rural road, there are two trucks in front of a truck, two trucks behind a truck, and one truck in the middle of two trucks. How many trucks are there in total?

Last week’s riddle: It can be told, made, cracked, and played. What is it? 

Answer: A joke.

John Dombroski Jr. may be reached at (480) 991-1055 or [email protected]
www.grandcanyonplanning.com

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