June 2024 Market Recap


    • June home sales fell while sale prices continued to rise.
    • Large-cap stocks continued to rise adding to recent gains.
    • Interest rates declined once again.
    • NVIDIA briefly became the most valuable public company in the world.

Economic Update


In May, US new single-family home sales plummeted by 11.3%, while existing home sales experienced a much smaller decline of 0.7% month-over-month. Despite the overall contraction in housing demand, the median sales price of existing homes rose by 3.1%, setting a new all-time high of $419,300. Mortgage rates fell for the second consecutive month, with the 15-year mortgage rate decreasing to 6.16% and the 30-year rate at 6.86%.


Stocks and Bonds

Equities continued their positive streak to close out the first half of the year. The NASDAQ surged another 6% while the S&P 500 and Dow Jones Industrial Average trailed slightly, each ending higher at 3.6% and 1.2% respectively.

The prevalence of the narrowness of the stock market’s advance was evidenced by the dispersion in returns between the different indexes for the month of June.  Outside of large-caps, both the Small- and Mid-cap benchmarks saw negative returns for the month, as did the MSCI EAFE, which measure the performance of the foreign developed markets.

Emerging markets bucked their recent trend and posted a solid 4.0% return for the month of June, pushing total returns over the past year to 13%.



Five of the 11 sectors finished in positive territory with Technology once again leading the way, up 7.8%. Consumer Discretionary and Communication Services trailed, gaining 3.9% and 3.2%. Materials and Utilities were the worst performing sectors in June, falling 3.1% and 5.6%, respectively.

Over the past 12 months, Communications Services and Technology, which are two of the sectors with the highest exposure to the Magnificent 7 names, remain in the lead with returns of 33.0% and 31.1%.

Somewhat surprisingly, Financials have seen strong returns over the past year, posting a total return of 24%.



Treasury yields declined across the board as core inflation has declined for 13 out of the past 14 months.  The 5-year Treasury note saw the largest decline on the curve for the second straight month, shedding another 19 basis points. For the third straight month, the 2-year, 3-year, 10-year, 20-year, and 30-year all decreased by double-dight basis points.

Fixed income benchmarks were broadly positive for the month and all remain in positive territory over the past year.




Regular readers of these monthly updates are likely as tired of hearing about the narrowness of the market’s advance as we are of writing about the topic.

Year-to-date as of June 30th, the S&P 500 has provided a total return (price change + dividends) of +15.29%. If we break out the Magnificent 7 from the remaining 493 stocks the returns are as follows:

           Magnificent 7: +36.97%

           S&P 500 ex-Magnificent 7: +8.28%

In June, Nvidia briefly became the largest publicly traded company in the world, with a total market capitalization of $3.335 Trillion on June 18th. (Microsoft’s market cap was at $3.317T and Apple’s was at $3.286T on the same day.) As you may recall from last month’s update, NVDA first crossed the trillion-dollar mark just over one year ago.  Five years ago, the stock wasn’t even in the top 50 largest S&P 500 companies and sat between 3M and Starbucks in terms of size. (Fun fact, Nvidia first joined the S&P 500 in November of 2001.  Any guess as to the company they replaced in the index? Answer: Enron.)

According to Howard Silverblatt, Senior Index Analyst with S&P Dow Jones, Nvidia is only the 12th company to be the largest publicly traded issue in the world since the end of 1925.  I was amazed to read that statistic.  In nearly a century, there have only been 12 companies that have held the spot of number one in terms of market value. All 12 companies are still in existence: AT&T, Apple, Cisco Systems, DuPont de Nemours, Exxon Mobil, General Electric, General Motors, International Business Machines, Microsoft, Nvidia, Philip Morris, and Walmart.

Of the 12, only Exxon Mobil and Walmart remain in the top 25, followed by Cisco at #37, IBM at #50, Philip Morris at #53, and AT&T at #63.  General Motors and DuPont are still hanging in there at #161 and #248, respectively. General Electric has gone through a significant restructuring over the past several years and now trades as three separate publicly traded companies: GE Aerospace (#44), GE Vernova (#181), and GE Health Care Technologies (#251).  If all three were combined, the current market value would rank at #26 in the S&P 500.

In their heydays, many of the companies above were at the cutting edge of the most significant and disruptive technologies and industries of their day.

Exxon Mobil and General Motors rode the wave of transportation transitioning from the horse and buggy to the internal combustion engine.

DuPont as a leader in plastic manufacturing. (Think Mr. McGuire to Benjamin Braddock in the 1967 film The Graduate: “I just want to say one word to you. Just one word. Are you listening? Plastics.”)

In the 1980s, IBM was poised to dominate the world with the personal computer.

In the late 1990s, the increasing demand for networking equipment positioned Cisco as a central player in the tech industry, as the company’s routers and switches became essential components of internet infrastructure.

Today, Artificial Intelligence (AI) appears to have the potential to be a generation-defining technology wave and companies like Nvidia are playing a critical role in enabling this technology.

The question is how much future growth is being discounted by the market’s valuation of these AI stocks today and are those growth assumptions reasonable? And, how much of their recent performance can be attributed to “AI FOMO” or the Fear of Missing Out?

A recent post by David Chan at Sequoia Capital sums it up well: “…we need to make sure not to believe the delusion that has now spread from Silicon Valley to the rest of the country, and indeed the world. That delusion says that we’re all going to get rich quick, because AGI is coming tomorrow…  In Reality, the road ahead is going to be a long one. It will have ups and downs. But almost certainly will be worthwhile.” AI’s $600B Question | Sequoia Capital

In today’s market, a healthy dose of skepticism combined with historical perspective can help us stay level-headed and remain anchored to realistic long-term expectations



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