A surprising reversal of fortunes on Wall Street, both in equities (-1.5% straight up on the Nasdaq) and in T-Bonds, which literally collapsed in the afternoon, with yields soaring by +10 to +12.5 basis points.

It had all started in the best possible way, with the S&P and Nasdaq raining down all-time highs in the first three quarters... but the rest of the session was marked by lightening on a broad front.

The Nasdaq Composite broke through the 18,000 barrier and set a new all-time record at 18,035: it gained +0.7% over the week, +9% over the second quarter and +18.6% since January 1... while the Nasdaq-100 clipped the 20,000 mark to climb towards 20.017 (i.e. a fivefold increase since February 2016 and a doubling since the end of June 2020) before finishing at -0.55%.

Record also broken for the S&P500 around 4.15pm (-0.4% to 5,460 in the end) after reaching a high of 5,523, i.e. +0.15% over the week, +4% over the quarter and +14.7% since January 1st.

The Nasdaq Composite ended down -0.7% at 17,733, despite gains - and sometimes intraday records - from Microchip, Comcast, MongoDB +2.3%, Qualcomm and AMD +1.7%, NXP and Applied Materials +1.5%.

The Dow Jones (-0.12% to 39.119) was weighed down by Nike's -20% to $75.4, Merck's -4.6%, Amazon's -2.3%, Apple's -1.6%, Microsoft's -1.3% (all three giants also weighing on the Nasdaq).

But over the first half, the Nasdaq crushed the competition thanks to Super Micro +189%, Nvidia +150%, ARM +117%, Meta +42%, Alphabet +30%, Amazon +27%, Microsoft 20.5%. The Dow Jones gained just +4% in the first half, weighed down by Walgreen -54%, Intel -38%, Boeing and Nike -30%. The S&P500 was slowed by the real estate sector (-4%), materials and consumer goods (+5%).

The day was punctuated by the publication of the much-awaited PCE index, but as is often the case when the suspense seems "enormous", it turned out to be a non-event. The annual inflation rate for the 'US consumer basket'- fell by -0.1 points as expected to 2.6% on a reported basis, and by 0.2 points to 2.6% on an underlying basis (excluding energy and food), compared with an anticipated -0.1 point decline on a core basis.

The US '10-yr' gave a very warm welcome to these figures, easing by -4 basis points to 4.26% shortly after 2.30pm... but steam completely reversed from 3.45pm onwards, and the heaviness increased as the hours went by, so that T-Bonds ended at their lowest, with yields soaring by +10 basis points on Friday (and +13 basis points on a weekly basis), to their worst levels since June 11, at 4.38%, with the '30-yr' adding +12.5 basis points to 4.552%.

The Commerce Department also reported that US household spending rose by 0.2% in May compared with the previous month, while incomes rose by 0.5% (more than expected).

It's hard to say whether the majority of "optimists" will continue to anticipate a Fed rate cut at the end of its September meeting (the ratio was balanced at 50/50 on Friday evening), but the strength of growth and persistent inflation (WTI was back up to $81.3) have called into question the idea that the Fed could make several rate cuts this year.

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