Economic Market Summary

Market Down and Dirty

Last Week’s Economic/Market Summary


  • U.S. equity indices moved lower last week as the rebound evaporated.

    • S&P 500 -2.27% Dow -1.28%, Russell 2000 -2.00%, Nasdaq -4.13%1

      • The All-Country World Index declined 2.26%.1 

    • S&P 500 sub-sectors were mostly lower last week.

      • Utilities, Energy, Staples, & Healthcare were the only positive sectors. 1 

      • Technology & Consumer Discretionary led to the downside with losses over 4.5%.1 

    • The CBOE Volatility Index (VIX) declined 1.98% to end at 26.69. 1 

  • US Treasury bond yields were firmly lower last week across the curve.

    • US 2yr -0.22% at 2.83%, 10yr -0.24% to 2.89%, 30yr -0.14% to 3.12%.1 

    • The yield curve flattened a great deal last week. 

  • Commodities as an aggregate asset class were lower.

    • WTI Crude finished slightly up at +0.63%.1 

    • Gold lost -1.06%.1 

    • The US Dollar index rose 0.89%.1 

  • In our opinion, U.S. economic data was mixed last week.

    • Inflation remained elevated in May. 1 

    • Consumer confidence once fell sharply in June. 1 

    • The ISM Manufacturing index slipped to its lowest reading in 2 years. 1 

  • An index of equities outside the US (FTSE All-World ex-US) dropped 1.77%.1 


  • Equity markets closed out the worst first half of a year since 1970 with a thud as the markets failed to continue recent strength last week.
    • Inflation & recession fears continued to dominate investors’ psyche. 

    • The tech-heavy Nasdaq led domestic markets to the downside last week with a loss of 4.13%.1

      • This growth oriented gauge that was the darling of investors since the Covid-bottom is now flirting with being down 30% year-to-date. 1 

    • While a drop in commodities recently helped the bounce, good ole fashioned fear of a recession prompted many to cut equity exposure heading into the holiday weekend. 

  • S&P 500 subsectors were mostly lower last week.

    • Utilities led to the upside by a wide margin as the steep decline in interest rates helped. 1 

    • Energy traded higher by over a percent as OPEC+ firmed up their production levels. 1 

    • Tech & Consumer Discretionary led things lower with declines of 4.53% & 4.75% respectively. 1

      • These sectors contributed heavily on the indices as their growth has led them to have larger than normal weightings. 

  • The VIX volatility index declined around 2%. 1

    • As we’ve discussed at length, the so called “fear gauge” has remained below levels seen in past bear markets. 1 

    • We believe this could suggest that the market has not yet seen the washout needed to spark a sustainable rally in equities. 

  • US government interest rates moved lower across the maturity curve last week.

    • The benchmark 10-year US Treasury yield plummeted 0.24% last week. 1

      • We believe this is as a result of economic data increasingly pointing towards a 2nd straight quarter of GDP contraction…the technical definition of a recession. 

    • In our opinion, the signal from the rates market about the future path of inflation has shifted significantly in recent weeks to now imply a much more rapid deceleration over the next year, reflecting the dual forces of accelerated tightening and rising growth concerns. 

  • Earnings season is upon us and all eyes will be on how corporate profits have weather the Q2 storm.

    • 2022 has been a valuation-driven equity bear market rather than a decline prompted by lower earnings. 

    • Despite recession fears, S&P 500 consensus 2022 and 2023 earnings per share estimates have both been revised up so far this year. 1

      • We believe that consensus profit margin forecasts have further to fall which will likely lead to downward earnings revisions whether or not the economy falls into recession. 

  • Non-US equities followed domestic equities lower last week.

    • Europe continues to deal with an energy crisis as the winter approaches and they attempt to cut themselves off from Russian supplies. 

    • China’s lower than normal demand for coal & oil has been helped by wetter than normal weather. 

    • In our opinion, the energy situation around the globe as winter comes could be the “event” that has marked past equity bear markets.

Ryan A. Mumy, CFP®,
AIF® – Chief Investment Officer

Contact: 828/855-9400 or 

 1 Source: Bloomberg – 7/01/2022  

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