Happy Friday!
Stocks continue to provide positive returns in Q2, but at a slower pace. The “K” economy: high earners feel more positive about their financial health than a year ago versus low earners. How will you celebrate National Paul Bunyan Day? The 2024 Paris Olympics are just a few weeks away – will 16-year-old track phenom Quincy Wilson make the Olympic team?
DSGCA will be closed Thursday, July 4th and Friday, July 5th for the holiday and will not be sending out a Friday 4 to our readers. Please look for our next Friday 4 on Friday, July 12th. We hope all of our readers have a Happy 4th of July Holiday!!
We moved!
The new DSGCA office address is:
7760 France Ave S
Edina, MN 55435
#1 – Weekly Market Recap – Stocks posted minor gains during a quiet week of trading before the holiday next week. Through Thursday, the S&P 500 gained +0.3% the NASDAQ rose +0.4% and the Dow Jones remained flat for the week.
This week’s economic data appeared to dissuade investors. This morning’s release of May’s Personal Consumption Expenditure (PCE) data, the Fed’s favored inflation measurement, reinforced that inflation is slowing with the smallest increase since March 2021.
Additionally, revised GDP data indicated that first quarter GDP decreased from the originally reported 1.6% growth to 1.4% — largely driven by negative consumer spending revisions.
Together, the recent economic data indicate a slowing economy with slowing inflation – two key ingredients for a future Federal interest rate cut. \
Through the first two quarters, the S&P 500 is up roughly 15%. As shown in the chart below, the S&P 500 continued to rise in Q2, but at a slower pace than Q1.
Technology and Communications companies continued to post impressive returns driven by AI infrastructure buildout. Just five sectors saw positive returns in Q2 compared to 10 sectors in Q1. However, all sectors except real estate were positive through the first half of 2024.
#2 – The “K” Economy – Fragmented Financial Feelings – Recent data from the Philadelphia Federal Reserve indicates a wide disparity in how Americans in different income brackets feel about their financial health.
Think of the divergent views as the two lines that make up a “K.” The upper line represents high earners where 55% are feeling “significantly more positive” or “more positive” about their financial health than a year ago. Meanwhile, low earners represent the downward sloping line where 34% feel “more negative” or “significantly more negative” than a year ago.
The disparity in views about financial health could be attributable to the differing impacts from slowing wage growth as well as the percentage of stock ownership.
- Slowdown in Wage Growth: According to data from the Atlanta Federal Reserve, wage growth has slowed across all income levels over the last year. However, the lowest income jobs have seen wages slow more significantly — wage growth slowed 1.7% for bottom quartile earners while falling only 0.4% for top quartile earnings.
- Stock Ownership: According to a recent Gallup survey, 84% of households earning more than $100,000 annually own stocks. In contrast, only 29% of households earning less than $40,000 per year report owning stocks. As a result of low stock ownership, lower earning Americans have not benefited as much as higher income earners as stock markets have raced ahead since the pandemic.
Source:Gallup
Source:AtlantaFed
#3 – Paul Bunyan Has His Day – In case you missed it, today – June 28th – is National Paul Bunyan Day!
Paul Bunyan is one of the most famous North American folklore heroes – the giant axe-toting lumberjack with an equally massive sidekick, Babe the Blue Ox.
The tales of Paul Bunyan originated in folktales told among lumberjacks in the Northeastern US and Eastern Canada. The story of Bunyan first appeared in print in 1906, published by Northern Michigan journalist James MacGillivray. In 1914, the Paul Bunyan character was used in a logging company’s advertising campaign – which helped spread the tall tale across the US and Canada.
Legends abound about Paul Bunyan. The origin story is that it took five storks to carry him as a baby. It has been said that as he grew older and clapped his hands or laughed, the windows in his house shook and shattered. Folklore credits the creation of thousands of Minnesota’s lakes from Paul’s footprints filling with water as he explored the state and that he created the Mississippi River by simply dragging his ax behind him.
Several Minnesota towns, including Akeley, Brainerd and Bemidji, lay claim as Paul Bunyan’s official birthplace. Large statues of Paul Bunyan and Babe the Blue Ox are popular tourist destinations and are considered “must-see” for anyone traveling through northern Minnesota. And let’s not forget Paul’s sweetheart, Lucette, said to be born in Hackensack, MN,
We don’t know of any “official” way in which to celebrate the day, perhaps you can split some logs or wear your favorite plaid flannel shirt. Or maybe just enjoy the day lakeside with your favorite (giant) beverage!
Source:National Day Calendar
#4 – Olympic Impact – The 2024 summer Olympics are just four weeks away. The Paris Olympic Games begin July 26th and run through August 11th. The Paralympics will also take place in Paris from August 28th – September 8th. Combined, nearly 15,000 athletes from more than 200 countries will compete in the Olympic and Paralympic Games.
On July 26th, Paris will welcome the Olympic torch during the opening ceremony. Breaking with tradition, the 2024 opening ceremony will be the first Olympics to be held outside of a stadium. Instead, the delegations from more than 200 countries will be traveling by boat down the Seine River in a 4-mile-long floating procession. Spectators will be able to watch the proceedings from the river’s banks.
After the Olympic cauldron is lit, 16 days of competition will occur with billions of television viewers worldwide tuning in to the Games.
Hosting an Olympic Games is a gargantuan bureaucratic and organizational task, not to mention the monetary cost involved. The Paris Olympics will be hosting the games within a “modest” budget of approximately $9.1 billion. While this doesn’t sound “modest,” it is roughly one-third the cost of the 2021 Tokyo Olympics and the smallest budget since the Sydney 2000 Games.
The tight budget was possible predominantly because much of the infrastructure needed for the games already existed and only a handful of new venues needed to be built. Additionally, six temporary venues will be used.
The Paris 2024 Olympics could generate a long-term economic boost of as much as $12 billion USD from tourism, construction, and the organization of the Games according to a study commissioned by Games organizers. Between 2.3 and 3.1 million Olympic spectators are expected to visit Paris during the Games, with roughly 64% of them from France.
One American who is gaining attention and could be headed to Paris is 16-year-old sprinting sensation Quincy Wilson. At the track and field trials in Eugene, Oregon, Quincy qualified for the men’s 400m final with two record-breaking runs — a 44.66 in round one and 44.59 in the semi-finals. The previous under-18 world record was set in 1982 by Darrell Robinson.
Although Wilson didn’t make the three-man 400m team, he could still be called on for the 4×400 relay team. If he makes the Olympic team, Wilson will be the youngest U.S. Olympic track and field Olympian since Cindy Gilbert in 1972 and youngest U.S. Olympic male runner ever.
Source: Gina Buss (6/25/2024)
Source: Olympics.com
Source: Statista
Source: 9News
Source: Olympics.com