In the second quarter of 2024, equities saw continued growth driven by optimism surrounding artificial intelligence and sustained consumer spending.  Real wage growth, coupled with a strong labor market, enabled consumers to maintain their purchasing power.  We saw positive trends in certain inflation metrics, such as gas and food prices, but escalating costs in areas like rent and leisure activities have offset these improvements.  The Federal Reserve's consideration of year-end rate cuts became uncertain following an inflation spike in March; then in the June meeting they took a more cautious stance, anticipating just one rate cut for 2024.  Although the inflation prints have been seemingly stubborn, we are still seeing a positive long-term trajectory, especially considering improvements in global supply chains and labor market dynamics.

Regarding the upcoming elections, historical data suggests that election outcomes have little to no influence on market performance on average.  Therefore, our focus remains on corporate fundamentals as the key drivers of long-term success.  We find that high quality companies that consistently return capital to shareholders, can help provide strong returns over the long run.


Wells Fargo Advisors did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of the author(s) and are not necessarily those of Wells Fargo Advisors or its affiliates. Past performance is no guarantee of future results.

Wells Fargo Investment Institute, Inc. (“WFII”) is a registered investment adviser and wholly-owned subsidiary of Wells Fargo & Company and provides investment advice to Wells Fargo Advisors and other Wells Fargo affiliates.