In June, the U.S. stock markets continued their upward trend with the Dow, S&P 500, and Nasdaq Composite all seeing gains. This positive momentum was driven by favorable economic data, despite a slow start in the first half of the month.
Looking ahead to July, recent reports from the Department of Commerce show mixed signals on inflation and consumer spending. While the PCE price index remained flat month over month in May, core PCE inflation saw a slight decrease. Additionally, manufacturing activities contracted in May and retail sales were below expectations.
The U.S. GDP growth rate for the first quarter of 2024 was revised downward, indicating a cooling economy. Consumer sentiment also took a hit in June, with the inflation outlook showing a slight decrease.
As a result, there is a high probability that the Fed will cut interest rates in the coming months. The CME FedWatch tool currently predicts a rate cut by September, with further cuts possible by the end of the year.
In light of these developments, it may be wise to consider investing in momentum stocks. DailyBubble has identified five large-cap stocks with strong potential for July and the rest of 2024. These companies have seen positive earnings estimate revisions in the last 30 days and carry a Zacks Rank #1 (Strong Buy) with a Momentum Score of A.
Among the top picks are Advanced Drainage Systems Inc., Vistra Corp., Spotify Technology S.A., Chewy Inc., and Barrick Gold Corp. Each of these companies has strong expected revenue and earnings growth rates for the current year, with positive consensus estimates from analysts.
Overall, while the economic indicators point to a cooling economy, there are still opportunities for investors in the stock market. DailyBubble recommends keeping an eye on these momentum stocks for potential gains in the coming months.