The indices rose around 1% last week as the Dow (+0.8%), NASDAQ (+1.1%), and S&P 500 (+1.0%) recouped the previous week’s modest declines to finish out the week at record highs. Taxable bonds declined between (-0.1% - -0.5%) and tax-free municipal bonds fell between (-0.1% - -0.2%) as interest rates rose last week.
Something of note this week is that the US senate reconvened on Sunday to iron out differences on the combined $1 Trillion infrastructure bill, which many believe will have enough support from both parties to pass this week. The passing of this bill should bring with it some tailwinds that could further boost the US indices. Investors are starting to become more cautious as spread of the COVID 19 delta variant continues to rise, and restaurant dining and air travel activity are beginning to level off. Even with the increase in cases, the markets are continuing to offset fears as strong second quarter earnings keep rolling in.
According to FactSet, 87% of the S&P 500 companies have reported their second quarter earnings so far. As earnings season comes to a close, the headlines may start to focus on the spread of the COVID 19 delta variant instead of the better-than-expected earnings companies had realized.
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