The U.S. stock market rallied in June following one of the worst monthly declines in May as President Trump’s threat to place tariffs on Mexico were cancelled, the Federal Reserve hinted of a July interest rate cut, and hopes for a truce in the ongoing trade war with China increased.
The Dow Jones Industrial Average (DJIA) rallied 7.1 percent in June, the biggest June rally in about 81 years, after declining by 6.6 percent in May. However, despite the attention-grabbing headline, the DJIA ended the month of June approximately 7 points higher than the April 30, 2019 closing level.
Moreover, although the markets have enjoyed an impressive first half in 2019, consider this: the “Dow” had to have the best monthly gain since 1938 in order to close just below a level it reached in January 2018 – about eighteen months ago. Clearly the markets have experienced massive volatility without much progress. In fact, even the S&P 500 index has gained just 2.4 percent from January 2018 to June 28, 2019.