Memorial Weekend Market Snapshot
The S&P 500 closed the week before Memorial Weekend at a record high of 5,200.14 on May 16, 2024, extending its winning streak to eight consecutive weeks as of the latest close. The Dow Jones Industrial Average gained 0.5% for the week, while the Nasdaq Composite rose 0.8%, led by mega-cap tech. Investors watched the Federal Reserve's May meeting minutes, which confirmed a "data-dependent" stance on rate cuts. The CME FedWatch tool showed a 70% probability of a 25 basis point cut at the June 12, 2024 meeting. Retail trading volume on platforms like Robinhood dipped 12% week-over-week, per third-party estimates shared in industry reports. For a deeper dive into the index performance, see the latest S&P Dow Jones Indices data here.
Bond yields moved inversely to equity gains, with the 10-year Treasury note falling to 4.20% by Friday close. The yield curve remained partially inverted, with the 2-year note yielding 4.65%. This inversion has persisted for over 24 months, a duration that historically precedes recessions, though the timing remains uncertain. The Federal Reserve Bank of St. Louis maintains its recession probability model at 30% for the next 12 months. The U.S. Treasury Department auctioned $102 billion in 3-year notes on Tuesday, with a bid-to-cover ratio of 2.45x, indicating moderate demand from primary dealers and indirect bidders.
Consumer Spending and Travel Trends
Memorial Weekend 2024 is projected to see 43.4 million Americans traveling 50 miles or more from home, a 2.8% increase from the prior year, according to the American Automobile Association. The average round-trip airfare for domestic flights rose 4.1% year-over-year to $298, based on data from the Department of Transportation's Bureau of Transportation Statistics. Gas prices averaged $3.52 per gallon nationally, down 11 cents from a month earlier, as reported by the U.S. Energy Information Administration. Hotel occupancy rates in popular destinations like Orlando and Myrtle Beach are forecast to hit 82% and 78%, respectively. The National Retail Federation expects consumers to spend an average of $143.6 on food, travel, and entertainment during the weekend.
E-commerce platforms saw a 15% surge in early holiday shopping searches, with Amazon reporting a 20% increase in "Memorial Weekend deals" queries on its site. Tesla's stock rose 1.2% during the pre-market hours on the Monday before the weekend, partly on expectations of a strong quarterly delivery report. SpaceX launched its 10th Starship test flight from Boca Chica, Texas, on a date that coincided with the start of the holiday weekend, drawing significant media and investor attention. For the official SEC filing on Tesla's Q1 2024 results, see the company's 10-Q here.
Investment Opportunities and Risk Considerations
Sector rotation favored energy and financials heading into the weekend, with the Energy Select Sector SPDR Fund (XLE) gaining 1.8% on the week. The Vanguard Real Estate ETF (VNQ) underperformed, declining 0.5% as mortgage rates held steady near 6.7%. The Federal Reserve's balance sheet reduction continued at a pace