Smart Advice. Simply. Clearly.
A LOOK BACK AT MARKETS IN Q2
The 2nd quarter was strong for U.S. equities. The S&P 500 reached a new all-time high in late June and closed the first half of 2021 with a 14% gain. Almost all sectors made gains over the 2nd quarter.
The Federal Reserve’s rate-setting meeting brought no change to policy, but its projections indicated that interest rate rises could come in 2023.
Inflation reports, unsurprisingly, grabbed a lot of headlines. Consumer prices increased 5.4% in June from a year earlier — the biggest monthly gain since August 2008 — with reopening a big driver.
In late June, President Joe Biden secured a deal on an infrastructure package worth about $1 trillion to upgrade roads, bridges, and broadband networks over the next eight years. However, the agreement fell short of the $2.3 trillion infrastructure spending plan announced in March and did not address the safety net spending proposed in April.
By sector, energy, IT, communication services, and real estate were among the market’s strongest areas. Utilities and consumer staples lagged.
With businesses getting a boost from surging demand, jobs coming back, and consumer spending elevated — the bottom line is the economy and markets are in a good spot right now. Yet conditions are ripe for volatility with concerns about the pace of the recovery and whether the Fed might pull back its aggressive monetary policy support.
At Hilltop, we’re consistently reviewing potential headwinds and opportunities to increase the predictability of your financial success. As always, we encourage you to speak with your advisor if you have any questions or concerns about your investment plan.