In my last letter, I was hoping for an A “May” Zing month…and we sure did hit the jackpot. This was the best May return for the S&P 500 since 1990! An incredible reward for all of us that stayed the course over the last couple of months. It’s a great reminder that volatility is just part of investing at times.
A major factor was the pause in tariffs on China. If there is a continued de-escalation, we might see some serious upside gains. It seems that every time there is the slightest hint at good news, the stock market wants to jump up. If the government can get some solid agreements in place, my assumption is that stock indexes would move up fairly rapidly.
Another issue that has been on everyone’s mind is inflation. We had a great CPI report mid-month that showed inflation slow to it’s lowest level since 2021. If inflation continues to cool, I’d bet that the Federal Reserve would begin to lower interest rates quickly.
The S&P500 also went positive on the year again mid-month--though it still bounces around flat territory. Hopefully corporate earnings will continue to surprise to the upside.
All of that good news mixed together gave us this powder keg of upside stock market growth. Now, we hope the Fed can figure out the bond market soon.
That’s probably a few good short points to take in from last month. I hope you have a great summer of gardening, boating, fishing, hiking, bird watching, cruising, and all the activities I get to hear about!
As clients of ours, we thank you for your continued trust in us!
Larry Mroczkowski
President
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. All investing involves risks, including the loss of principal.