Economic Market Summary

Market Down and Dirty

Last Week’s Economic/Market Summary


  • U.S. equity indices ended the week lower despite a Friday rally.
    • S&P 500 -0.91% Dow -0.16%, Russell 2000 -1.42%, Nasdaq -1.57%1
      • The All-Country World Index moved lower by 1.62%.1 
    • S&P 500 sub-sectors were all lower last week except Consumer Staples.
      • Staples & Utilities were virtually flat on the week to lead sector performance. 1 
    • Energy led to the downside with a loss of 3.33%.1  
    • The CBOE Volatility Index (VIX) declined 2% to end at 24.20. 1 
  • US Treasury bond yields moved lower on the long-end of the curve last week.
    • US 2yr +0.02% at 3.11%, 10yr -0.17% to 2.93%, 30yr -0.18% to 3.09%.1 
    • Stabilization in rates could be transpiring, which could bode well for equity markets. 
  • Commodities as an aggregate asset class continued their recent move lower.
    • WTI Crude sank 7% to end @ $97.48. 1 
    • Gold lost 2%.1 
    • The US Dollar index rose 0.90%.1 
  • In our opinion, U.S. economic data was mixed last week.
    • Retail sales came in better than expected for the previous month. 1 
    • Consumer Sentiment surprised with improvement in its latest reading. 1 
    • Rising rates continue to cause a slowdown in the housing market. 1 
  • An index of equities outside the US (FTSE All-World ex-US) underperformed at -2.43%.1 


  • The back & forth in price action of the headline indices continued as equity markets ended the week lower following a big rise the previous week.
    • The up and down oscillations have continued for over a month with headline indices staying fairly rangebound. 
    • A worse than expected CPI print sent inflation readings to their highest since 1981 before Friday’s release of retail spending & consumer sentiment brought markets higher into the weekend. 1 
    • We believe with most of the inflation, Fed, geopolitical “news flow” priced into the markets, investors have turned their eyes to earnings & the US Dollar for guidance in the short-term. 
  • S&P 500 subsectors were mostly lower last week.
    • The defensive Staples & Utilities were flat while Energy lost 3%.1 
    • Barring some “light” at the end of the tunnel for various headwinds facing the global economy, it’ll be hard to identify any clear trend forward at the sector level. 
    • We discourage anyone from taking too much away from weekly price action until this happens. 
  • US government interest rates moved mostly lower, led by the longer maturities.
    • The 2yr US Treasury ended the week yielding 3.11% while the 10yr ended at 2.93%.1
      • This inversion stayed for the entire week. 1 
      • We remind readers that the inversion in of itself has little impact on the equity markets while it does often correspond to an economic recession. 
      • The saying “The economy isn’t the stock market” comes to mind. 
  • The US Dollar continued it’s run higher with a gain of 0.90% while non-US markets underperformed. 1
    • Concerns over global growth have recently sent the Bloomberg Dollar Index to its strongest level on record with the greenback hitting multi-decade highs against the Euro & Yen. 1 
    • The US currency also has a special position in world markets…when investors are worried, they tend to rush to the safety of dollar-denominated assets, sending the currency even higher.
      • That’s one reason why the dollar surged when markets crashed in March of 2020, and why it’s been strengthening now. 
    • Complicating the current situation is the fact the major central banks around the world are now in tightening more, or are about to be, which could further embolden the dollar. 
    • This can put pressure on non-US equities as well as global oriented multinational’s headquartered in the United States. 
  • Earnings season is upon us as results started last week.
    • Thus far, earnings results have been mixed company to company, but slightly positive overall. 
    • This quarter’s earnings results will give investors a sense of whether sales and earnings have held up against inflation, higher rates, and waning consumer sentiment. 
    • While over the past 12 months, corporate profitability has been resilient in the face of a surge in inflation, Omicron, and supply chain disruptions, the peak in return on equity might have peaked already.

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

Contact: 828/855-9400 or 

 1 Source: Bloomberg – 7/15/2022  

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