Market Insights: Second Quarter 2024

The second quarter of 2024 was marked by significant developments in the global economy and U.S. financial markets. We saw a continuation of the economic recovery that began in late 2023, albeit with some notable shifts in market dynamics. The S&P 500 gained 4.3% for the quarter. 

Bond yields stabilized in Q2 after the volatility experienced in the early half of 2024. The 10-year U.S. Treasury yield ended the quarter around 4.25%, reflecting a more balanced outlook on inflation and economic growth. Oil prices moderated, with WTI crude settling over $80 per barrel. Gold maintained its appeal as a safe-haven asset, trading near $2,350 per ounce. And the U.S. dollar weakened against a basket of major currencies, providing a tailwind for international investments.

The global economy continued its post-pandemic recovery, with most major economies showing signs of sustainable growth. U.S. GDP growth remained robust at an annualized rate of 2.7% for Q2 2024. Inflation, while still above central bank targets, showed signs of moderation. The U.S. Consumer Price Index (CPI) rose by 3% year-over-year in June. Labor markets remained tight, although the U.S. unemployment rate rose to 4.1%. Lastly, The Federal Reserve maintained its cautious stance, keeping interest rates unchanged during the quarter but signaling potential easing as soon as September.

Our diversified approach to asset allocation has served our clients well during this period of market transitions. Equity allocations benefited with growth stocks, commodities, and the healthcare sector leading for the quarter. Fixed income portfolios also stabilized.

As we move into the second half of 2024, we remain cautiously optimistic about the investment landscape. We will be focused on a few key areas, including: The potential for central bank policy shifts and their impact on interest rates; ongoing geopolitical tensions and their effects on global trade and energy markets; and the continued evolution of artificial intelligence (AI) and its transformative impact across various sectors.

We are actively adjusting our strategies to navigate these dynamics while staying true to our long-term investment philosophy.

We believe our disciplined approach to risk management and opportunistic positioning will continue to serve our clients well. We remain committed to helping you achieve your financial goals and are always available to discuss your individual investment needs.

Thank you for your continued trust and confidence.

The Primoris Wealth Advisors Team