Stocks reached new all-time highs last week as markets staged a strong rebound from the previous week’s declines.
The Dow Jones Industrial Average rose 3.44%, while the Standard & Poor’s 500 picked up 2.74%. The Nasdaq Composite index increased 2.35%. The MSCI EAFE index, which tracks developed overseas stock markets, gained 0.97%.1,2,3
Stocks rallied on the first day of trading last week and gained further momentum on Thursday and Friday. Despite some discouraging data on housing and initial jobless claims, stocks managed to set new highs, as investors cheered an agreement between President Biden and a group of senators that appeared to pave the way for the passage of a $1 trillion infrastructure bill.4
Positive results from the Federal Reserve’s stress tests of banks, which raised the prospect of banks raising their dividend payouts and share buybacks, and a key inflation measure coming in at market expectations provided impetus for further gains. The S&P 500 had its best week since February and ended the five-trading days at a record high.5
Historically low mortgage rates, the COVID-19 pandemic, and a flush consumer have contributed to a very strong housing market in recent months. Last week’s housing data for May, however, showed that housing may be running into headwinds. The rising cost of materials and labor led to a 5.9% decline in new single home sales in May even as the median price hit an all-time high.6
Meanwhile, sales of existing homes fell 0.9%, the fourth-straight month of declines, owing to a very low inventory. High demand, coupled with a depressed supply, led to a 23.6% increase in the median price of an existing home.7
This Week: Key Economic Data
Tuesday: Consumer Confidence.
Wednesday: ADP (Automated Data Processing) Employment Report.
Thursday: Jobless Claims. ISM (Institute of Supply Management) Manufacturing Index.
Friday: Employment Situation Report. Factory Orders.
Source: Econoday, June 25, 2021
This Week: Companies Reporting Earnings
Wednesday: Micron Technology, Inc. (MU), Constellation Brands, Inc. (STZ), General Mills, Inc. (GIS).
Thursday: Walgreens Boots Alliance, Inc. (WBA), McCormick & Company, Inc. (MKC).
Source: Zacks, June 25, 2021
Tax Season May be Over, but the Taxpayer Bill of Rights Applies Year-Round
Even though filing season might be over for the majority of taxpayers, the IRS is available year-round for any questions you might have. They also have a Taxpayer Bill of Rights, which promises the level of service and information you will receive when working with the IRS.
Here are the 10 fundamental rights you have as a taxpayer when interacting with the IRS:
* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Tip adapted from IRS.gov8
Can you write down eight eights so that they add up to one thousand?
Last week’s riddle: Before Mt. Everest was measured, in 1819, what was the highest mountain on earth? Answer: Mt. Everest was the highest - it simply hadn't been measured yet.
Footnotes and Sources
2. The Wall Street Journal, June 25, 2021
3. The Wall Street Journal, June 25, 2021
4. CNBC, June 23, 2021
5. CNBC, June 23, 2021
6. Fox Business, June 23, 2021
7. CNBC, June 22, 2021
8. IRS.gov, January 21, 2021
9. Healthline.com, June 28, 2019
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