The S&P 500 rose 1% during the fourth and final week of July 2023. The index closed out the trading week at 4582.23.

The major market-moving news event of the week was the Federal Reserve's quarter point rate hike, which it announced on Wednesday, 26 July 2023. And though Fed Chair Jay Powell did his best to try to convince anyone listening the Fed was looking to increase the Federal Funds Rate higher at the following press conference, investors weren't buying it.

Instead, after watching the Fed hike the Federal Funds Rate to a target range of 5.25%-5.50%, the CME Group's FedWatch Tool now projects no future rate hikes through April 2024, six weeks longer than what they expected before the Fed's meeting. The FedWatch Tool then anticipates a series of quarter point rate cuts will begin as early as 1 May (2024-Q2) that are expected to continue at six-to-twelve-week intervals through the end of 2024.

The latest update to the alternative futures chart shows the trajectory of the S&P 500 is consistent with what the dividend futures-based model predicts it would be if investors were focusing their forward looking attention on either 2023-Q4 or 2024-Q1. Although there's very little difference between the alternate future trajectories projected by the model, we'll assume investors are looking ahead to the fourth quarter of 2023 until we have more evidence to indicate otherwise.

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We use the Federal Reserve's regularly-paced announcements of how it will set the Federal Funds Rate as calibration events to determine the value of the multiplier (m) for the dividend futures-based model. Since 9 March 2023, we've observed the value of multiplier is approximately 1.5, which continues to hold after the Fed's July 2023 announcement.

Other stuff happened during the week to affect the trajectory of stock prices in the U.S. Here's our summary of those market-moving headlines.

Monday, 24 July 2023

• Signs and portents for the U.S. economy:
  • U.S. business activity growth slows as services soften
• Bigger trouble, stimulus developing in China:
  • China property giants tumble as cash crunch bites
    • Analysis-China's pitch to foreign investors falls flat as incentives dwindle
  • China to step up policy adjustments amid tortuous recovery
    • China's state planner unveils steps to spur private investment
    • China to step up policy adjustments amid tortuous recovery
• JapanGov minions want BOJ minions on board for hitting inflation target:
  • Japan govt sees inflation slowing next year, calls for BOJ coordination
• ECB minions excitement growing over next rate hike despite worsening Eurozone economy:
  • Factbox-Brokerages ramp up ECB rate hike bets on sticky inflation, hawkish policymakers
  • Worsening euro zone business downturn reignites recession fears
• Dow leads Wall Street higher as investors eye beyond tech

Tuesday, 25 July 2023

• Signs and portents for the U.S. economy:
  • Oil prices hit 3-month highs on tightening supplies
• Fed minions hurt there won't be a happy dance:
  • No happy dance in the cards as Fed ponders resilient US economy
• Bigger stimulus developing in China:
  • China's property firms rally after Beijing pledges economic support
• ECB minions getting results they wanted:
  • Euro zone firms slash loan demand to lowest on record: ECB poll
• Dow notches longest win-streak since Feb. 2017, Nasdaq, S&P close with gains
  • Analysis-Sensing end of Fed hikes, some investors return to dividend stocks

Wednesday, 26 July 2023

• Signs and portents for the U.S. economy:
  • US commercial property delinquencies rise further in July -report
  • US new home sales fall, but trend remains strong
  • Oil falls 1% after Fed rate hike, smaller-than-expected US crude stockdraw
• Fed minions do the expected, threaten to hike rates again, claim there will be no recession:
  • Fed lifts rates, Powell leaves door open to another hike in September
    • Fed's Powell: A September rate rise is possible if data warrants action
  • Fed staff drop US recession forecast, Powell says
• ECB minions getting new problems to think about:
  • European banks flag bad loan risks as global economy falters
  • Euro zone lending slows further as rate hikes bite
• Nasdaq, S&P falter; Dow matches record longest win-streak with 13th straight day in green

Thursday, 27 July 2023

• Signs and portents for the U.S. economy:
  • Oil settles above April peak on tighter supply
  • US bank regulators announce sweeping proposals on capital rules
    • Bank of America CEO flags effects of higher capital requirements
  • US pending home sales rise for first time since February
• Bigger trouble developing in the Eurozone:
  • New building starts nosedive in Germany in latest sign of property stress
• Other central banks go into copycat mode:
  • Gulf central banks raise key interest rates by 25 bps, mirroring Fed
  • Hong Kong central bank raises interest rate after Fed hike
  • Thai central bank to hike rates by 25 bps on Aug. 2, ending tightening cycle - Reuters poll
  • ECB raises key rate to historic high, keeps options open
  • ECB fans talk of September pause after raising rates to 23-year high
• But the BOJ minions have something different in mind:
  • Japan to maintain accommodative policy - govt official quotes BOJ's Ueda
  • BOJ seen keeping ultra-low rates, may debate tweak to yield cap
• Bigger trouble, stimulus developing in China:
  • China industrial profits extend double-digit slide on weak demand
    • South Korea export downturn seen worsening on weak China demand: Reuters poll
  • China to boost credit support to consumer sector - regulator
• Wall Street closes down, Dow snaps longest winning streak since 1987
  • Market Panics After Planted Story Of BOJ YCC Tweak Sends Stocks Tumbling, Yields And Yen Soaring

Friday, 28 July 2023

• Signs and portents for the U.S. economy:
  • Oil posts fifth week of gains on signals of tighter supply
  • US annual inflation slows in June, consumer spending solid
  • Softening inflation props up U.S. consumer sentiment
• Bigger trouble, stimulus developing in China:
  • China factory activity likely to contract for fourth month in July: Reuters poll
  • China's housing minister urges efforts to strengthen property recovery
• BOJ minions tweak never-ending stimulus:
  • BOJ takes steps to make YCC more flexible, keeps ultra-low rates
    • BOJ Governor Ueda's comments at news conference
    • Japan yields hit 9-year high, yen gains after BOJ delivers 'stealth' policy shift
    • Analysis-Bank of Japan's opaque policy shift means stronger, wilder yen
• ECB minions starting to have second thoughts about more rate hikes:
  • ECB's Stournaras says further interest rate rise in September 'looks difficult'
  • ECB contemplates end of rate hikes as outlook worsens
• Intel results, soft inflation data boost S&P, Dow; Nasdaq posts best day since late May
  • Intel pops as Wall Street sees light at end of PC tunnel

The BEA's first estimate of real GDP growth in the second quarter of 2023 came in at 2.4%, in line with the final projection of the Atlanta Fed's GDPNow tool. That tool is now looking at the current quarter of 2023-Q3, where its first estimate of the real GDP growth rate 3.5%.

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