July 1, 2022

Markets:

U.S. stock futures slip Friday morning after the S&P 500 closed out its worst first-half performance in decades.

Micron Technology fell more than 5% in premarket trading on the back of disappointing fiscal fourth-quarter guidance. Several other chipmakers fell more than 1% with it including Nvidia, Qualcomm and Marvel. Western Digital lost 3%.

Thursday marked the end of the second quarter and the first half of the year. For the quarter, the S&P 500 fell more than 16% – its biggest one-quarter fall since March 2020. For the first half, the broader market index dropped 20.6% for its largest first-half decline since 1970. It also tumbled into bear market territory, down more than 21% from a record high set early January.

The 30-stock Dow lost 11.3% in the second quarter, putting it down more than 15% for 2022. The Nasdaq, meanwhile, suffered its biggest quarterly drop since 2008, losing 22.4%. Those losses pushed the tech-heavy composite deep into bear market territory, down nearly 32% from an all-time high set in November. It’s also down 29.5% year to date.

The Fed, in turn, has stepped up its efforts against the surge in prices, hiking by 0.75 percentage point in June. That was its biggest rate increase since 1994.

Traders will take in more economic data Friday, with the latest ISM manufacturing index and construction spending numbers set for release at 10 a.m. ET.

Portfolio:

We enter the last trading session of the week as we head into a 3-day holiday weekend holding positions in X, ALLY, and ITRM. Today marks the first trading session of the new quarter. Markets suffered one of the worst starts to the year since 1970 but historically every time a market has dropped 21% or more have always enjoyed second half rebounds. It'll be a trend we will be watching closely especially as we enter season trades and mid-term elections. We will be watching trade activity closely this morning while looking to potentially release a new opportunity to position ourselves for next week. Be ready and let's have a great session.