SNB cuts rates, BoE holds, US stock averages eke out weekly gains, despite Nvidia setback

Macroeconomic/ geopolitical developments

• In a holiday-shortened week, US stock averages posted modest gains with the Dow up 1.5%, the S&P 500 rising 0.6%, and the Nasdaq barely increasing by less than 0.1%, despite Nvidia’s stock cooling amidst market headwinds.
• The Swiss National Bank reduced its key interest rate by 25 basis points to 1.25%, citing easing inflation, while the Bank of England kept its rate at 5.25%, with hints of a potential rate cut in August amid mixed market reactions and falling inflation expectations.

• Disappointing PMI data from Germany and the Eurozone contrasted with robust US PMI figures, which indicated healthy expansion in the US private sector.
• Nvidia’s retreat from its peak this week, despite a 155% surge in 2024, triggered a $246 billion swing in market cap on Thursday, leading to a dip in the S&P 500 and in the Nasdaq, underscoring its significant market influence amid concerns about concentrated gains and potential broader market impact.

Global financial market developments

• US and global equity averages extended slowly higher
• US and European bond were little changed on the week
• The US Dollar Index extended June gains.
• Gold futures rallied then sold off Friday.
• Oil futures rallied to new multi-week highs.

Key this week

Central Bank Watch: Central bank activity is light this week with the focus on Fed speakers.

Macro Data Watch: The main macro data releases this week are the global CPI data throughout the week. But the main focal points for the week will be the US GDP and Durable Goods data Wednesday, then key will be the Fed’s preferred inflation measure, the MoM and YoY PCE data on Friday.

Steve Miley (The Market Chartist)

Editor in chief

Steve Miley is the Market Chartist and has 32 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Mar... Continued