Trading Week Predictions: June 19 – 22

Next week, the trading week will be shorter due to the Juneteenth holiday, with US markets closed on Monday. Throughout the week, we can expect several key updates in the housing market, including the release of building permits and housing starts data for May, as well as the NAHB’s Housing Market Index for June. Furthermore, in the upcoming week, we can anticipate Federal Reserve Chair Jerome Powell’s appearance before Congress on Wednesday and Thursday for his semiannual testimony on monetary policy. Additionally, on Friday, S&P Global will release the highly anticipated Purchasing Managers’ Index (PMI) reading for June, providing valuable insights into the state of the economy. Moreover, notable companies such as FedEx, Accenture, Darden Restaurants, and BlackBerry are scheduled to report their earnings.

Key events and earnings reports for the upcoming week:

Monday, June 19:

• US markets closed for the Juneteenth holiday
• Sigma Lithium Corp. (SGML) reports earnings
• NAHB Housing Market Index (June)

Tuesday, June 20:

• FedEx Corporation (FDX), Freedom Holding Corp. (FRHC), and La-Z-Boy Inc. (LZB) report earnings
• Housing Starts (May)
• Building Permits (May)

Wednesday, June 21:

• KB Home (KBH) and Winnebago Industries Inc. (WGO) report earnings
• Fed Chair Powell testifies to House panel

Thursday, June 22:

• Accenture (ACN), Darden Restaurants Inc. (DRI), FactSet Research Systems Inc. (FDS), Commercial Metals Company (CMC), BlackBerry Ltd. (BB), and GMS Inc. (GMS) report earnings
• Fed Chair Powell testifies before the US Senate
• Chicago Fed National Activity Index (May)

Friday, June 23:

• CarMax Inc. (KMX) reports earnings
• S&P Global Composite PMI – Flash Estimate (June)

These events and earnings reports will provide valuable insights into the housing market, economic indicators, and the performance of various companies in the coming week.

How to Invest in June

Investors looking for opportunities in June amidst the uncertain economic outlook of 2023 have reasons to be hopeful. As of May 25, the S&P 500 had already gained approximately 9% year-to-date, reaching the 100th trading day milestone. Historical data indicates that when the S&P 500 has been up at least 8% on this particular day in previous years, the index has gone on to average an additional 10% gain for the remainder of the year since 1950.

Examining recent history, in 2021, the S&P 500 was up more than 8% on the 100th trading day, ultimately finishing the year with a remarkable 26.9% gain.

For investors concerned about a potential US recession, adopting a defensive approach and increasing cash holdings while reducing exposure to stocks can provide financial flexibility in 2023. Online savings accounts already offer interest rates of 4% or higher, and these rates are expected to remain elevated for several months.

Value stocks have historically outperformed growth stocks in high-interest-rate environments, and in 2022, growth stocks significantly lagged behind value stocks. However, in 2023, this trend has reversed as investors anticipate a potential end to rate hikes and even the Federal Reserve is considering rate cuts by year-end.