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Jul 05, 2023

June 2023

Stocks had a decidedly positive June as the Dow Jones Industrial Average rose 4.7%, the S&P 500 advanced 6.6%, and the NASDAQ charged 6.8% higher. June was an especially good month for small-cap stocks; the Russell 2000 Small Caps index surged 8.1%. Globally, the MSCI Developed Markets index tacked on 4.6% and its Emerging Markets counterpart increased 3.9%.

All 11 US stock sectors were positive in June. Of note, Consumer Discretionary, Industrials, and Materials all posted double-digit gains. Though defensive sectors such as Health Care, Consumer Staples, and Utilities were at the bottom of the pack, they joined the other eight sectors in contributing to June’s market rally.

Last month’s Inflation reading came in at 4.05%, its lowest level in two years. Core Inflation declined slightly, while CPI notched marginally higher MoM. Amid softening inflation, the Federal Reserve kept the Target Federal Funds Rate unchanged at 5.25%, making its June 14th meeting the first without an increase in the last 11 meetings.

Medium-term US Treasury yields rose in June while those on shorter-term Treasury Bills or long-term bonds either declined or ended the month relatively unchanged. The 2-Year and 3-Year made the largest advances, 47 and 45 basis points, respectively. The 1-Month Treasury Bill fell 4 basis points, and interestingly enough, the long-term 30-Year was unchanged MoM as of the end of June.

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