This Weekly Market Update reviews the top market headlines: U.S. Home Sales Fall Amid Rising Prices, Personal Spending Stalls, Federal Reserve Lifts Restrictions on Banks

Top Three Market Headlines 

U.S. Home Sales Fall Amid Rising Prices: Existing-home sales in the United States fell 0.9% in May compared to April, according to data released last week by the National Association of Realtors (NAR). This marked the fourth straight month of declining sales as record-high home prices have depressed buying activity. The median existing-home sales price hit $350,300 in May according to the NAR, a 23.6% jump from the prior year. While a much smaller market than existing-home sales, new home sales also declined in May, falling 5.9% from April.

Personal Spending Stalls: The Bureau of Economic Analysts (BEA) reported last week that personal consumption expenditures (PCE), a measure of consumer spending for all goods and services, were flat in May compared to the prior month. This marked the second straight month of decelerating spending, which had grown at a 5.0% rate in March as stimulus checks were distributed. An increase in spending on services, led by recreation, food, and accommodations, was largely offset by a decline in goods, particularly automobiles. The release also reported that the PCE price index rose 3.9% versus the prior year, the largest gain since 2008. However, the monthly increase in the price index downshifted to 0.4% from April’s pace of 0.6%.

Federal Reserve Lifts Restrictions on Banks: The Federal Reserve last week announced it was rolling back pandemic-induced restrictions on dividend payments and share buybacks for large national banks. The notice came following the banks’ successful performance in a series of stress tests designed to assess what would happen to their capital in the event of an economic shock. The Fed indicated that all banks examined in the tests remained “well above” minimum required capital levels and are therefore well-positioned for a downturn. The news gave a shot in the arm to bank stocks, as the Invesco KBW Bank ETF gained more than 6% on the week, bringing its year-to-date gain to a healthy 32.2%.

Please note: There will be no Weekly Market Update published the week of July 6th, 2021. We would like to wish everyone a happy Fourth of July! 

As of June 25, 2021 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World 2.28% 7.65% 12.57% 39.96%
S&P 500 2.76% 8.11% 14.79% 41.01%
Russell 2000 4.33% 5.33% 18.71% 66.96%
MSCI EAFE 1.50% 6.84% 10.55% 34.51%
MSCI Emerging Markets 1.41% 5.34% 7.75% 40.08%
FTSE NAREIT 1.96% 13.69% 23.77% 41.34%
Bloomberg Commodity 1.65% 10.78% 18.45% 45.80%
Barclays U.S. Aggregate -0.41% 1.42% -2.00% -0.55%

MarketWatch 6/25/2021, BEA 6/25/2021, WSJ 6/24/2021, Marketwatch 6/24/2021, CNBC 6/24/2021; data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory, named and independent fiduciary services are offered through Gallagher Fiduciary Advisors, LLC, an SEC Registered Investment Adviser. Gallagher Fiduciary Advisors, LLC does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. Gallagher Fiduciary Advisors, LLC is a single-member, limited-liability company, with Gallagher Benefit Services, Inc. as its single member. Neither Arthur J. Gallagher & Co., Gallagher Fiduciary Advisors, LLC nor their affiliates provide accounting, legal or tax advice. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your Gallagher Fiduciary Advisors consultant before acting upon any information or recommendation contained herein to discuss the suitability of the information/recommendation for your specific situation.