This Weekly Financial Markets Update reviews the top market headlines: Inflation Eases Marginally in July, Spending on Autos Drives Retail Sales Increase, China’s Economic Growth Falters
  • The Consumer Price Index increased 2.9% on an annual basis in July
  • Retail sales rose 1% in July versus the prior month
  • New home prices in China fell 4.9% in July

Top Three Market Headlines

Inflation Eases Marginally in July: The U.S. Department of Labor reported last week that the Consumer Price Index (CPI) rose 0.2% in July from the prior month and was up 2.9% on a year-over-year basis. The latter figure was down slightly from a 3.0% pace in June and was the lowest annual rate since March 2021. The "core" CPI, which excludes volatile food and energy items, increased 0.2% in July and was up 3.2% on an annual basis, continuning a downward trend from the prior month's reading of 3.3%. Shelter costs were a primary driver of the core CPI increase, rising 5.1% on an annual basis.

Spending on Autos Drives Retail Sales Increase: The U.S. Census Bureau reported last week that U.S. retail sales jumped 1% in July versus the prior month, rebounding from a 0.2% decline in June. The overall level of sales was boosted particularly by strong spending at auto dealers (+3.6%). Excluding automobiles and fuel, retail sales rose at a more modest 0.4% pace on the month. Other areas of strength in July included electronics & appliances stores (+1.6%), grocery stores (+1.0%), home improvement stores (+0.9%), drug stores (+0.8%), and furniture stores (+0.5%).

China's Economic Growth Falters: Recent economic reports out of China suggest the world's second-largest economy is losing momentum. The Purchasing Manufacturing Index (PMI) for China registered 49.4% for July, slightly below the 50% threshold that differentiates expansion of business activity from contraction, while factory output growth decelerated for the third straight month. Meanwhile, new home prices fell 4.9% in July, the largest decline since June 2015, raising speculation the government will increase efforts to support the housing sector. Government officials indicated recently that future economic stimulus measures could focus more on consumers than infrastructure and manufacturing.

As of Aug 16, 2024 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World 3.90% 2.11% 13.65% 23.36%
S&P 500 3.99% 1.89% 17.47% 28.00%
Russell 2000 2.98% 4.74% 6.56% 16.16%
MSCI EAFE 4.09% 2.81% 8.30% 16.85%
MSCI Emerging Markets 2.90% 1.26% 8.84% 14.94%
FTSE NAREIT Equity 0.33% 8.16% 8.02% 19.38%
Bloomberg Commodity 0.31% -4.55% 0.36% -2.35%
Bloomberg U.S. Aggregate 0.53% 3.64% 2.91% 8.58%

U.S. Census Bureau 8/15/2024, US Dept, of Labor 8/14/2024, WSJ 8/9/2024, 7/30/2024. Reuters 8/15/2024. Data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory, named and independent fiduciary services are offered through Gallagher Fiduciary Advisors, LLC, an SEC Registered Investment Adviser. Gallagher Fiduciary Advisors, LLC does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. Gallagher Fiduciary Advisors, LLC is a single-member, limited-liability company, with Gallagher Benefit Services, Inc. as its single member. Neither Arthur J. Gallagher & Co., Gallagher Fiduciary Advisors, LLC nor their affiliates provide accounting, legal or tax advice. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your Gallagher Fiduciary Advisors consultant before acting upon any information or recommendation contained herein to discuss the suitability of the information/recommendation for your specific situation.