Today's Scoop:

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Here’s what you need to know today…

1. Americans feel more optimistic about the economy.

2. Home prices keep inflating.

3. Rents have stopped rising so quickly.

S&P 500: 4,567.46
1Mo: +6% | 1Yr: +16% | 5Yr: +62%

The market continued the positive momentum again today. The economy seems to be doing pretty well, and corporate financial reports have been solid. Investors will be watching Big Tech earnings carefully this week. [🤓]

Americans are feeling good about the economy. The Conference Board’s Consumer Confidence Index rose to the highest level in two years this month, far exceeding expectations. People are less worried about inflation and aren’t having trouble finding jobs. Many expect a recession, but not necessarily a bad one. Consumer spending powers two-thirds of the economy, so our feelings matter.

Home prices keep rising. Expensive mortgage rates have deterred homebuyers and encouraged homeowners to hang on to their homes with cheaper mortgages. The Federal Housing Finance Agency reported median home prices rose by 0.7% for the second straight month in May. Prices were 2.8% higher than they were twelve months ago.

Rents have stopped rising so quickly. Realtor.com reported national median rents rose slightly in June from May, but were 1% cheaper than the year before for the first time since 2020. Rent is still 24% more expensive than before the pandemic.

Click to dig in & vote your reaction, see how others feel

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• General Motors sales and profits surge

• Unilever loses sales after hiking prices too much

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Big Tech companies drive the market

The performance of Big Tech companies is critical to overall sentiment in the stock market. The Big Five - Apple, Microsoft, Amazon, Alphabet (Google), and Nvidia are so enormous compared to every other company that the fluctuations of their value drive the changes in The Market as a whole.

The S&P 500 index is the primary way people track whether The Market is rising or falling. It's a number that follows the value of the biggest 500 public companies in the US. As with most indexes, the actual number isn't as significant as the direction it moves. It helps us understand whether America's biggest corporations are growing. Daily fluctuations are very normal.

Because the S&P 500 Index is weighted by the size of the companies, the Big Five alone account for over 20% of the total size of The Market. The other ~495 companies make up the additional 80%. So the prices of those Big Tech companies significantly affect the perception of how the whole market is doing.

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