Two All-Time Highs Across Indexes on Friday, Potential Headwinds for Markets in July Likely Followed by Strong 2H

Summary

- S&P 500 closes at another all-time high of 4,352.34 up from 4,280.70 last Friday. The DJIA inched closer to its May ATH and the Nasdaq hit an ATH.

- The delta variant is rising, and we have amended our base case to now reflect a surge in the states with the lowest proportional levels of vaccinated residents.

- While there are complicated headline risks and problematic developments with COVID-19 economic data remains very strong and re-opening will be hard to restrain.

- We discuss 1H2021 and what we see on the horizon for the 2H2021. Despite short-term headwinds we expect it to be a very strong half.

The S&P 500 finished the first half of 2021 up about 14%, which is a very solid reading for any period, let alone one fraught with the plethora of risks that constantly circle the market in this tumultuous and prosperous year. We started the year out with something that many thought would be a weeks long trend, but instead appears to be fundamentally changing markets. The meme stock movement, the rise of the millennial investor and the voracious risk appetite of the largest, best educated generation on Earth are not trends investors can afford to ignore or minimize. The phenomenon has not gone away, and we think those underestimating the impact m...

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