Dear readers,

As we sail through the ever-changing waters of the financial world, I am thrilled to share some exciting news about the first half of 2023. The S&P 500 Index has shown incredible strength, soaring 19.5% year-to-date through July. This outstanding performance marks its best start since 1997 and stands as the 10th-best record since 1926. But what fueled this remarkable success, and what can we expect for the rest of the year?

First and foremost, the impressive gains in the first half were primarily driven by a select group of technology behemoths, often referred to as the “Magnificent Seven.” Companies like NVidia, Facebook, Microsoft, Google, and others in the tech sector played a pivotal role in the market’s growth. These industry giants managed to recover most of the losses they incurred during the challenging year of 2022, propelling the overall market forward with their strong performances.

Now, let’s take a closer look at historical data to gain insights into the potential performance for the rest of the year. The table above displays all the years when the S&P 500 rose at least 15% through July. Over the last five months of those years, the index rose 86.4% of the time, with a median gain of 7.0%. In only one case, 1935, did the S&P 500 post a bigger gain after July than before it. Two other years, 1927 and 1958, saw a faster pace of gains after July. This suggests that, on average, strong starts to the year tend to be followed by further gains, though they may be somewhat smaller in comparison.

However, historical records also reveal intriguing exceptions. In 1935, the S&P 500 defied the norm by posting a bigger gain after July than before it. Additionally, in both 1927 and 1958, the index saw a faster pace of gains after July. These instances remind us that while historical patterns can provide valuable insights, the market remains dynamic and can surprise us at times.

As we continue on this financial journey, it’s essential to remember that the market is complex and ever-changing, influenced by various macro drivers such as economic conditions, Federal Reserve policies, inflation rates, and geopolitical factors. While we celebrate the strong start of 2023 and the impressive performances of the Magnificent Seven, we must remain cautious and vigilant in our investment decisions.

At Advanced Wealth Management, our mission is to empower you with the knowledge and insights necessary to make informed choices about your financial future. Knowledge is power, and by staying informed and understanding market trends, we can navigate the complexities of the financial world with confidence.

As we move further into 2023, our outlook remains cautiously optimistic but are expecting a choppier second half than the first.

In conclusion, let us celebrate the successes of the first half and the incredible performance of the Magnificent Seven. However, let us also remain vigilant and well-informed as we tackle the challenges and opportunities that lie ahead in the financial landscape of 2023.

Thank you for being a part of our journey, and we look forward to navigating the future together.

Warm regards,

Tony Gomes CEO, Advanced Wealth Management

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