U.S. stock indexes register best quarter since 2020
Optimism over signs of progress in efforts to bring the Iran war to a lasting halt has helped stocks recently despite continued tensions
The S&P 500 and Nasdaq finished June on Tuesday with their biggest quarterly gains since 2020 as investors remained upbeat about economic and earnings growth even amid the Middle East war.
The Dow had its biggest quarterly jump since 2022.
The indexes closed higher for the day as well, with the Dow registering a record closing high for the second straight day. Technology led gains among S&P 500 sectors, and an index of semiconductor stocks ended 3.9% higher on the day.
Optimism over signs of progress in efforts to bring the Iran war to a lasting halt has helped stocks recently despite continued tensions.
Iran and U.S. on June 17 signed a memorandum of understanding aimed at ending the four-month-old war. But exchanges of fire over the weekend have tested that agreement.
We’ve had a great first half of the year, certainly better than most expected, said Oliver Pursche, senior vice president and advisor for Wealthspire Advisors in Westport, Connecticut.
In spite of all the geopolitical stuff, the U.S. economy is performing well and corporate earnings are strong, he said.
After a strong first-quarter earnings season for S&P 500 companies, investors are looking forward to second-quarter results in the coming weeks.
A sharp rise in oil prices at the start of the war ramped up concerns about inflation and interest rate hikes. Traders are pricing in at least one rate hike by the U.S. central bank by the end of 2026, according to data compiled by LSEG.
The Dow Jones Industrial Average gained 136.46 points, or 0.26%, to 52,319.20, the S&P 500 added 58.93 points, or 0.79%, to 7,499.36 and the Nasdaq Composite advanced 393.58 points, or 1.52%, to 26,213.72.
Weakness in heavyweight technology shares has weighed on the market in recent weeks, and the S&P 500 and Nasdaq both registered losses for the month of June.
Investors have been concerned about lofty valuations in the tech sector and continued massive spending on AI by tech companies.
For the quarter, the Dow was up about 13%, the S&P 500 added 14.9% and the Nasdaq advanced 21.4%.
Strategists at BofA said cyclical, value-oriented sectors such as energy and financials could be the better bet heading into the second half.