The Dividend Cafe - The Dividend Cafe Wednesday - July 24, 2024

Episode Date: July 24, 2024

Market Analysis and Sector Performance on July 24th In this episode of Dividend Cafe, Brian Szytel analyzes the market performance for July 24th from West Palm Beach, Florida. The Dow closed 504 points lower, the S&P fell by 2.31%, and the NASDAQ dropped by 3.64%. Significant declines in Google and Tesla stocks driven by earnings misses led to the NASDAQ's poor performance. Despite the downturn, sectors such as energy, staples, utilities, and healthcare saw positive results. Interest rates slightly increased, with the 10-year yield up by three basis points. Brian discusses the yield curve changes and the economic indicators, including slight misses in new home sales and positive PMI report. Looking ahead, the episode mentions upcoming PCE data and the Fed meeting next week, followed by expectations for Q2 GDP revisions and durable goods orders. The VIX index spiked by 22% indicating heightened market volatility. 00:00 Introduction and Market Overview 00:54 Sector Performance and Interest Rates 01:56 Economic Data Highlights 02:39 Upcoming Economic Events 03:15 Closing Remarks Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividend Cafe, weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Welcome to Dividend Cafe. It is Wednesday, July the 24th, and Brian Seitel with you here today again from our beautiful West Palm Beach, Florida office. And unfortunately, a down day in markets. We had the Dow close lower by about 504 points. So decent drawdown. We had the S&P lower by 2.31% and the NASDAQ was down by 3.64%. So the delta between what the Dow was down and what the NASDAQ was down was over 200 basis points. So we saw this big bifurcation in results on the day in stocks. And a lot of that was part of the NASDAQ

being technology driven, both Google and Tesla missed on earnings and were meaningfully lower. And that drove that index lower, but overall still more narrative for the growth to value rotation camp, because on the day, even with this sort of big down day, the big drawdown day, we still had energy, staples, utilities, healthcare. All those sectors were positive inside of that. So really just one-sided today in market action. The interest rates were slightly higher. The 10-year was up three basis points on the day. We closed at 429. But it's interesting that the amount that the yield curve has steepened last couple of months. We were a year, over 100 basis points inverted between twos and tens. We're now only 14 basis points. And honestly, it's somewhat typical in this stage of the cycle,

as we near the end of a rate tightening cycle and enter into a rate monetary easing cycle, rate cutting cycle, to see that yield curve start to re to un-invert, to start to be positively sloped there again. And again, we'll see if there ultimately comes a recession or some sort of slowdown. That's not what we're seeing presently. The big numbers really today, there wasn't a lot of economic data. There was new home sales that slightly missed, but that wasn't enough to move the market like today. And then there was technically a positive number out of the flash PMI report. We got a 55 number, which is anything over 50 is expanding. So that was

positive. And inside of that, we had prices paid actually lower or rise the small amount, smallest in about six months. So technically it was the porridge is just right from a PMI report. So those two things weren't what moved the market. It was really just an overvalued part of the market selling off. There was earnings disappointments in that side of things. And there you have it on the day. The larger economic news on the day will be the PCE data that won't come out until Friday. And so that'll be heavily watched. And the next week we have the Fed meeting. Those two things will be more meaningful. But just in volatility on the day, the VIX was technically up 22% on the day. So a big move higher in volatility. So all that to say, tomorrow we've got a Q2 revision. We're expecting something around a 2.1 from a previous

1.4. So we'll see where GDP comes in. We also have some initial jobless claims. We've got some durable goods orders in there as well for in the economic calendar. So I'll be back with you tomorrow, Thursday. I wish you all a lovely evening. Reach out with any questions as you always do. And I shall talk to you soon. Thank you. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, with Hightower Advisors LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Advisors LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory services are offered through Hightower Advisors LLC. This is not an offer to buy or sell securities. No investment

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