Good Morning,

The week of June 19 to June 26, 2023, saw the stock market undergo considerable fluctuations. Despite the market being shut on June 19 to celebrate Juneteenth, a federal holiday in the U.S., the week's trading was marked by notable declines.

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As the market resumed operations, a wave of stock decreases affected Europe's primary equity index and various industries. This was primarily due to rising global economic concerns and uncertainties surrounding the direction of interest rates. The S&P 500 index witnessed a continuous drop, opening at 4,388.71 on June 20 and finally closing at 4,360.05 on June 26.

The decline was spearheaded by the Nasdaq Composite on June 23, which plunged by 1% amid worries over global interest rate hikes and their potential repercussions on the world economy. U.S. stocks had their roughest week since March, stirred by fears of central banks resorting to an increase in interest rates to ward off inflation.

Certain businesses like Sartorius AG took a hard hit, with a steep 15% fall following an alarmingly large profit warning. The absence of additional stimulus measures also led to a downturn in Chinese tech companies. Chip manufacturers Marvell Technology and GlobalFoundries, Microsoft, and Nvidia witnessed a slump in their stock prices.

Despite the overarching negative trend, there was some positive news. DD's Discounts, a subsidiary of Ross Stores, announced the inauguration of a new store in Phoenix on June 24, 2023. Similarly, CarMax stocks appreciated, buoyed by better-than-expected earnings. Moreover, 3M was able to reach a settlement in a series of contamination lawsuits.

Several factors influenced the market's performance, including concerns over global interest-rate hikes, potential implications for the world economy, and the direction of interest rates. The testimony by Federal Reserve Chair Jerome Powell, indicating future interest rate hikes due to persistently high inflation, further fueled the market's decline.

While a rough road might lie ahead owing to strict monetary policies and dwindling credit availability, investors are encouraged to view pullbacks as golden opportunities to augment their positions. The economic forecast remains somewhat cloudy, with some economists foreseeing a 2023 recession, which could dampen S&P 500's earnings growth. Yet, amidst these challenges, the tenacity of the labor market and encouraging corporate bond market performance instill a measure of optimism.

Have a great week!

Irving Wilkinson
Editor
AlphaBetaStock.com

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