This Weekly Financial Markets Update reviews the top market headlines: Leading Indicators Continue Negative Trend, Retail Sales Disappoint in May, Home Sales Fall Again in May

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Top Three Market Headlines

Leading Indicators Continue Negative Trend: The Conference Board reported last week that its U.S. Leading Economic Index (LEI) fell 0.5% in May, keyed by a contraction in new orders, weakening consumer sentiment, and lower building permits. Overall, the index fell 2.0% over the six-month period through May 2024, though the organization noted this doesn't necessarily signal an upcoming recession since this rate of change was improved compared to the previous six-month period. Nonetheless, The Conference Board projects that real GDP growth will slow to less than 1.0% on an annualized basis over Q2 and Q3 2024.

Retail Sales Disappoint in May: The U.S. Census Bureau reported last week that sales at U.S. retail and food service establishments rose 0.1% in May from the prior month, or 2.3% on a year-over-year basis. Results were impacted by lower monthly sales at gasoline stations (-2.2%) and restaurants (-0.4%). The 0.1% increase fell short of economists' expectations for a 0.3% rise and came after sales had declined 0.2% in April. On a trailing three-month basis, sales through May were up just 0.5% versus the previous three-month period and 2.9% over the prior year, including the effect of inflation on sales prices.

Home Sales Fall Again in May: Sales of existing homes in the U.S. fell in May for the third straight month, according to the National Association of Realtors (NAR). Sales registered 4.11 million units (seasonally adjusted annual rate), down 0.7% from 4.14 million units in April and 2.8% from May 2023. The decline came amid a continued rise in home prices, as the NAR reported that the median sales price in May increased to $419,300, up 5.8% on the year and the highest on record. NAR economists also noted, however, that a recent increase in housing inventory (up 7% in May) could "boost sales and tame price gains in the upcoming months."

As of June 24, 2024 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World 0.52% 2.73% 11.15% 20.51%
S&P 500 0.63% 4.34% 15.36% 27.08%
Russell 2000 0.80% -4.54% 0.40% 10.19%
MSCI EAFE 0.07% -0.77% 4.97% 10.83%
MSCI Emerging Markets 0.98% 4.93% 7.42% 11.06%
FTSE NAREIT Equity 0.13% -1.28% -1.47% 8.58%
Bloomberg Commodity -0.59% 3.53% 5.80% 2.47%
Barclays U.S. Aggregate -0.15% 0.72% -0.07% 2.89%