A summer lull was expected this week in between key economic data and ahead of the on-ramp to the Q2 Earnings Expressway next week. That is what we got, at least in terms of economic data and corporate news flow, but geopolitics and AI-related headlines filled the void. Those two factors drove some choppy trading. The S&P 500 traded in a reasonably tight range consolidating just over its 50d moving average ending the week modestly higher. The gains were by technology with the NYSE 100 index closing the week up ~2.5%. However, most other major US indices ended the week with slight losses.

The sector level activity was mixed this week and at the extremes it was a mirror image of last week with tech-heavy sectors outperforming and healthcare and other defensive/yield-oriented sectors pulling back. For obvious reasons energy was one of the best performing sectors. Materials fell ~2%. Consumer Discretionary ended the week higher helped by gains in auto-related and the mega-caps while housing/travel related stocks were under pressure.

Next week is going to be very busy. Inflation data will be very closely watched with CPI released on Tuesday morning just before we start two days of the task force drinking game with Fed Chair Warsh testifying before Congress. Retail sales will be released on Thursday and it is the “official” start of earnings season with financials leading us out of the gates, a smattering of healthcare and industrial companies mixed in throughout the week and two important overseas tech companies- Taiwan Semi and ASML. Enjoy the weekend!