July 2021 Monthly Market Recap

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Posted on July 16th, 2021

Monthly Market Recap

from Clint Edgington, CFA

June saw a continuation of the global economic rebound scattered with supply chain constraints and inflationary pressures that has characterized 2021, with an increase in volatility in both the bond and equity markets.  We believe these trends, including increased volatility, have legs.

Economic growth was confirmed as U.S. GDP increased at an annual rate of 6.4% in the first quarter of 2021.  While this is a backwards looking gauge of activity, we can see other forward looking indicators showing a continuation of the expansion, such as The Institute for Supply Management’s forward looking index of Services showed growth at 60.1%, down slightly from the previous month’s all-time high of 64% (anything over 50% is expansion).  Employment continues to increase, with June’s data coming in higher than expected with 692,000 new jobs filled vs. 600,000 expected.  Yet as job openings remain at all-time highs unemployment continues to hang around the 5.9% area, which may change as emergency COVID-19 unemployment benefits fall off in June and July. 

As such, U.S. equity markets had a good June and a great first half of the year.

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