The S&P 500 index rose 2.2 percent and recorded another all-time high in July notwithstanding a significant uptick in volatility as the COVID-Delta variant has caused the number of new cases to rise. Uncertainty about the government’s response, including whether we will be subject to new restrictions, weighed on the markets.
The S&P 500 experienced its worst and best one-day performance since March on back-to-back days in July. Although the number of COVID cases are on the rise, the number of fatalities has remained relatively low compared to last year.
The yield of the 10-year U.S. Treasury Note fell to 1.24 percent at the end of July, down from 1.45 percent at the end of June and 1.74 percent at the end of the first quarter. This action seems to be counterintuitive given that inflation, according to the core personal consumption expenditures (PCE), rose 3.5 percent year-over-year, the highest since 1991.