Summer is supposed to be easy sailing for investors. However, lately, the seas have been a bit choppy. Volatility has continued to return with a vengeance, producing a constant wave in the markets. We’re now back to the one day up, one day down pattern. Driving this trend has been a random collection of data and news, plus the lack of political reports.
As for data, this week was an easy one after last week’s blitz of mid-month numbers. What was released was generally bullish and positive. Corporate earnings also picked up a little steam. While we are still far from the next round of earnings season, a few bellwethers did report and the numbers were good.
The biggest driver of the week was the Federal Reserve. After last week’s decision to raise rates, various Fed governors began their next round of speeches. Those talks gave a positive yet cautious tone on the economy and inflation.
All in all, the week featured bumpy trading as traders’ moods changed on a dime and no real direction could be found.
Check out last week’s Market Wrap here.
Stocks surged on Monday after entering the weekend in losses. Driving those returns was the recently beaten-down technology sector. Investors have questioned tech stocks and their ability to grow enough to justify their continued gains. Several bearish analyst reports had punished the industry in recent weeks. With major tech stocks now trading at discounts, investors snagged shares in spades. This helped push up the major averages on the day and overcame some of the bearish news from the Fed.