The S&P 500 index once again closed at an all-time high on Monday last week. However, the equity index fell the rest of the week to close with a return of -0.35%. Some disappointing earnings announcements in Tech+ names and increasing concerns about the Delta variant of COVID pushed down equities to close last week. Earnings season was in full swing as 48% of the weight in the S&P 500 announced quarterly results.
Treasury yields dropped slightly over the course of the week as the Federal Reserve met and kept the target range for the fed-funds rate between 0 and 0.25%. Investors expected the central bank to keep rates unchanged and asset purchases at $120 billion monthly. Fed officials said that they would continue to access in coming meetings whether the economy had progressed enough for tapering of future bond purchases. Fed Chairman Jerome Powell said that they still have not agreed on timing of raising interest rates but that it was still a ways off. He also said that the recent high inflation readings were tied to the sectors of the economy that reflect reopening and the price pressures do not appear to be spreading to other parts of the economy. Consumer confidence rose to a 16-month high, which is the highest since the beginning of the pandemic, beating analyst expectations. However, 2nd Quarter GDP was significantly lower than expectations, growing at a rate of 6.5% compared to an expert consensus rate of 8.4%.