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Growth Rebounds in June

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Monthly Market Snapshot: June 2021

Highlights

Investors reversed course in June with S&P 500 Growth stocks rallying 5.6% and S&P 500 Value stocks slipping 1.3%. Interestingly, both indices hit all-time highs in June. The NASDAQ surged 5.5% as investors fled back to comfortable positions as the Federal Reserve signaled that the tapering of asset purchases and first interest rate hike may occur sooner than originally forecast. After four consecutive months of gains (rising 15.2% between the start of February and the end of May), the Dow Jones posted a 0.1% loss as the reopening trade took a pause. Outside the U.S., European stocks fell -2.4% while Japanese stocks slid 0.4%. Contrary to expectations, the 10-year U.S. Treasury yield fell for a third straight month – finishing the month at 1.47%.

All eyes will be on policymakers in the second half of the year. A U.S. infrastructure bill appears likely, though the potential changes in U.S. tax policy remain unclear, and every Fed meeting will likely be considered “live” as investors wait for an announcement on the tapering of bond purchases.

Citi’s Global Investment Committee (GIC) left its asset allocation unchanged at its June 23 meeting. The GIC’s overweight to Global Equity and REITS remains at +8%. Fixed Income and Cash remains at -8%.