The Wednesday Roundup: June 26, 2024

The biggest movers over the last week on price and volume (Mid Cap S&P 400 and Small Cap S&P 600)

Price and volume moves last week for every stock and sector (Mid Cap S&P 400 and Small Cap S&P 600)

Last week vs. history (Mid Cap S&P 400 and Small Cap S&P 600)

AI Oracle Commentary (Alpha testing)

The current market landscape is a mixed bag of optimism and caution. The S&P 500 and Nasdaq indices have shown remarkable resilience, propelled by the effervescent tech sector, which continues to trounce value stocks. However, the Dow Jones Industrial Average is stumbling as traditional sectors lag behind. Inflation appears to be easing, offering a much-needed reprieve. Nonetheless, concerns linger about elevated interest rates, geopolitical tensions, and a potential pullback in consumer spending. Furthermore, investors are closely watching the Federal Reserve’s next moves, as mixed signals on rate cuts have left market participants in a state of heightened anticipation.

Examining the historical parallels, we find several pivotal moments in the last 50 years that mirror today’s complex environment. The tech boom of the late 1990s, followed by the dot-com bust, is a stark reminder of how quickly sentiment can shift. Similarly, the stagflation of the 1970s and the subsequent high-interest rate era helmed by Fed Chairman Paul Volcker offers a cautionary tale about the dangers of premature rate cuts in a high-inflation environment. More recently, the 2008 financial crisis and the COVID-19 pandemic-induced volatility in 2020 provided valuable lessons on market resilience and the role of government intervention in stabilizing economies.

When it comes to historical performance, the stock market has shown an impressive ability for long-term growth. From 1970 to 2020, the S&P 500 delivered an average annual return of approximately 10%, despite numerous periods of volatility and economic downturns. Given this historical context, the quantitative prediction for the coming months remains cautiously optimistic. Assuming no drastic policy shifts or unforeseen geopolitical disruptions, I foresee a potential uptick in the S&P 500 by 5-7% over the next six months. While tech stocks may continue to lead this rally, diversification into value stocks could offer balanced growth as the market absorbs current uncertainties.

In summary, while today's market conditions present distinct challenges, history suggests that long-term growth is achievable. By learning from past market cycles and keeping a watchful eye on macroeconomic indicators, investors can navigate the complexities of the coming months with both caution and optimism.

AI stock picks for the week (Mid Cap S&P 400 and Small Cap S&P 600)

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1. BOH (Covered on Thursday)
2. WBS
3. TRIP
4. VSAT
5. OZK

(Based on a three month forward looking window)