The S&P 500 (SP500) on Friday added 0.39% for the week to close at 4,298.86 points, posting gains in three out of five sessions. Its accompanying SPDR S&P 500 Trust ETF (NYSEARCA:SPY) rose 0.46% for the week.
The benchmark index has now strung together four straight weeks of gains, while also closing at its highest level since mid-August last year. Additionally, it crossed a significant milestone on Thursday, ending more than 20% above its October 2022 closing low and thus exiting its longest bear-market run since the 1940s.
The Federal Reserve was in its blackout period this week ahead of its monetary policy committee meeting from June 13 to 14. Moreover, the economic calendar was fairly light. Investors largely refrained from making big moves ahead of the rate decision and the consumer inflation report for May.
Global developments were in the spotlight this week. Last weekend, Saudi Arabia agreed to another voluntary production cut of 1M bpd, reducing its total output to its lowest level since June 2021. The move, however, was unable to help crude oil prices, with futures (CL1:COM) retreating for the week. Weak Chinese economic data and rising U.S. fuel stockpiles also contributed to the decline.
Meanwhile, central bank actions grabbed some headlines despite the Fed’s blackout period. The reserve banks of Australia and Canada during the week unexpectedly hiked interest rates and hinted at more tightening to come. According to the CME FedWatch tool, market participants in the U.S. are still pricing in a rate hike skip at the Fed’s meeting next week, though those expectations have been tempered somewhat.
Economic data during the week gave some strength to the Fed pause narrative. The Institute for Supply Management’s gauge of U.S. services activity nearly showed a stagnation for May, while factory orders for April rose less than expected. Moreover, initial jobless claims surged to their highest level since October 2021. The data pointed towards signs of cooling in the economy while also suggesting that cracks had begun to show in the highly resilient labor market.
Cryptocurrencies grabbed some attention this week. The U.S. Securities and Exchange Commission (SEC) continued to crack down on crypto entities. The regulator on Monday sued Binance, the world’s largest crypto exchange, and its top boss for allegedly violating U.S. securities regulations. The SEC followed that up on Tuesday by filing a lawsuit against crypto exchange Coinbase (COIN), alleging that it was operating as an unregistered securities broker. Bitcoin (BTC-USD) was on track for weekly losses of nearly 3%.
Turning to the weekly performance of the 11 S&P 500 (SP500) sectors, seven ended in the green, with Consumer Discretionary continuing its hot streak and topping the board. Technology cooled, ending as the top loser as investors moved into other sectors. See below a breakdown of the weekly performance of the sectors as well as their accompanying SPDR Select Sector ETFs from June 2 close to June 9 close:
#1: Consumer Discretionary +2.44%, and the Consumer Discretionary Select Sector SPDR ETF (XLY) +2.68%.
#2: Utilities +1.91%, and the Utilities Select Sector SPDR ETF (XLU) +1.95%.
#3: Energy +1.71%, and the Energy Select Sector SPDR ETF (XLE) +1.79%.
#4: Industrials +1.38%, and the Industrial Select Sector SPDR ETF (XLI) +1.45%.
#5: Financials +1.05%, and the Financial Select Sector SPDR ETF (XLF) +1.07%.
#6: Real Estate +0.68%, and the Real Estate Select Sector SPDR ETF (XLRE) +0.84%.
#7: Materials +0.55%, and the Materials Select Sector SPDR ETF (XLB) +0.55%.
#8: Health Care -0.08%, and the Health Care Select Sector SPDR ETF (XLV) +0.08%.
#9: Communication Services -0.42%, and the Communication Services Select Sector SPDR Fund (XLC) +0.08%.
#10: Consumer Staples -0.53%, and the Consumer Staples Select Sector SPDR ETF (XLP) -0.68%.
#11: Information Technology -0.66%, and the Technology Select Sector SPDR ETF (XLK) -0.53%.
Below is a chart of the 11 sectors’ YTD performance and how they fared against the S&P 500. For investors looking into the future of what’s happening, take a look at the Seeking Alpha Catalyst Watch to see next week’s breakdown of actionable events that stand out.