The Monthly Market Wrap provides an insightful analysis of treasury yields, fixed income performance, mega-cap stocks, and key economic indicators in June 2026. It also delves into housing market data and the performance of commodities.
Key Stock Market Index Performance
Markets were mixed in June. The small caps Russell 2000 led the way with a 3.7% gain, while the blue-chip Dow Jones Industrial Average posted a 2.7% increase. The tech-heavy Nasdaq was the largest laggard, slipping 2.8% in June.
Sector performance was split fairly evenly, with six of the eleven sectors ending the month higher. Industrials led with a 7.3% gain, followed by Health Care rising 6.6%.
Energy lagged for the third consecutive month, down 5.0%, with Communication Services logging the worst sector performance of 7.2% in June.
Economic Data
Employment
The unemployment rate ticked down 0.1 percentage point to 4.2%, the lowest level in one year, and the economy added 57,000 jobs according to the most recent nonfarm payrolls report, well below the Dow Jones consensus forecast of 115,000.
The Labor Force Participation Rate decreased by 0.3% to 61.80%, reaching a five-year low.
Inflation vs. Fed Funds Rate
The inflation rate rose another 0.40% month-over-month to 4.2%, the highest reading since May 2023 and third straight monthly increase. Core inflation increased by 0.10% month-over-month to 2.90%, also logging its third monthly increase.
The CME FedWatch tool indicates an 82% chance that the FOMC will hold the Fed Funds Rate at 3.50–3.75% during its next meeting on July 29th, with market pricing increasingly reflecting the possibility of a hike later in 2026.
Housing Prices and Mortgage Rates
Existing Home Sales increased 3.22% month-over-month in May, while the Median Sales Price of Existing Homes reached a new all time high of $429,300, an increase of 2.83%, or $11,800, MoM.
Mortgage rates went virtually unchanged in June, ending the month at 5.84% for the 15-year and 6.49% for the 30-year, both as of June 25th.
New Single-Family Home Sales declined month-over-month, falling 7.35% in May, though well off the pace of January’s historic 20% drop.
Services and Manufacturing Sectors Signal Expansion
The ISM Manufacturing PMI declined by 0.7 points to 53.30 for June after setting a three-year high of 54.00 in May. The Services PMI rose by 0.9 points in May to 54.50.
The year-over-year Producer Price Index surged higher for a fifth straight month straight to 6.5% in May, its highest reading since December 2022, while Retail and Food Services Sales continued to increase, at 0.88% in May.
Fixed Income
Treasury yields had mixed movements in June as yields on shorter-term treasuries increased while those of longer-term instruments decreased.
The 3-month, 6-month, and 1-year rose 18, 23, and 19 basis points, respectively. The 20-year declined 5 basis points, and the 30-year slipped 8 bps.
Bond funds were up across the board in June, as the iShares 20+ Year Treasury Bond ETF (TLT) led with a 1.2% gain.
Bautis Financial LLC is a registered investment advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.
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