Last Week’s Highlights:

U.S. equities rallied to record highs as Federal Reserve Chairman Powell strongly signaled that the central bank is ready to cut interest rates at the end of the month and perhaps again later in the year. For the week, all three major U.S. indices closed at record levels: the Dow Jones Industrial Average (DJIA) rose 409.91 points, or 1.52%, to 27,332.03, while the S&P 500 gained 0.8% to 3013.77. The tech-heavy NASDAQ climbed 1.0% to 8244.14. The Dow industrials have risen 17% this year, while the S&P has jumped over 20%, with much of these gains following the Fed’s encouragements of a rate cut. Health-care stocks did especially well last week, as the Trump administration abandoned a plan to curb drug rebates. The decision canceled a proposal that would have eliminated rebates from government drug plans, easing concerns of a disruption to the U.S. pharmaceutical industry. Many health-care stocks, including Dow component UnitedHealth Group (UNH), rallied on the news.

Looking Ahead:

Earnings season unofficially kicks off on Monday. Citigroup (C) is the first of the major banks to be up, reporting its second-quarter numbers before the market open. Charles Schwab (SCHW), Luby’s (LUB) and J.B. Hunt Transport Services (JBHT) also release numbers that day. JPMorgan Chase (JPM), Wells Fargo (WFC), Goldman Sachs (GS) and Johnson & Johnson (JNJ) are among a long list of companies announcing quarterly earnings on Tuesday. Look for financial results from Alcoa (AA), Bank of America (BAC) and Abbott Laboratories (ABT) on Wednesday. Thursday brings earnings results from over 58 publicly listed U.S. companies, including numbers from Blackstone Group (BX), Union Pacific (UNP), Nucor Corporation (NUE) and Microsoft (MSFT). The busy business week concludes with financial releases from American Express (AXP), State Street Corporation (STT) and Schlumberger NV (SLB) on Friday. Economic reports during the week include Chinese GDP for Q2, Industrial and Manufacturing Production for June and Eurozone GDP for Q1.

The Tufton Capital Team hopes that you have a wonderful week!