Stock Market’s Summer Fling Wasn’t the Real Thing
The season was as uneventful for macro fundamentals as many expected. That makes the rally in equities look like a head fake.
The S&P 500 Index posted its biggest weekly decline since July 1 last week.
Photographer: Angela Weiss/AFP/Getty Images
Summer was supposed to be a period of relative inactivity in markets, and it seemed as though A-Team traders were free to go about their vacation plans without fear of missing out on significant developments.
Of course, the dog days of summer turned out to be much more eventful than many expected. The S&P 500 Index rallied 17% from its June low; meme stocks and Bitcoin began to sizzle once again; and even downtrodden homebuilders caught an updraft. Some chalked it up to the illusion of a change in Fed messaging at Chair Jerome Powell’s July 27 press conference. Others credited the resilience of earnings. And some saw indications of a classic short squeeze.