Although the US stock market has repeatedly hit new highs, most stocks have performed poorly, and the news that usually drives these stocks up has not had such an effect. This sign indicates that the US stock market will not be an exciting investment place for a period of time.

Just last week,$S&P 500 Index (.SPX.US)$Dropped by 0.1%.$Dow Jones Industrial Average (.DJI.US)$The drop was also 0.1%.$Nasdaq Composite Index (.IXIC.US)$Rose 0.2%. However, last week Invesco S&P 500 Equal Weight ETF fell by 0.7%, which is different from the S&P 500 index that allocates weight by market value. Each stock in this ETF has the same weight, so it can be seen from its trend that the average stock performance is poor.

Invesco S&P 500 Equal Weight ETF has been trying to break through the historical high of $169, but has failed.$FedEx (FDX.US)$Even the optimistic interpretation of the global economy cannot push buyers to push the ETF to new highs. FedEx said last Wednesday (June 26) that it expects revenue growth to be between 1% and 6% in fiscal year 2025, which is a clear signal that global commodity demand is growing. However, Invesco S&P 500 Equal Weight ETF fell by 0.4% on that day.

Last week's performance of US stocks

Frank Gretz, a market strategist at Wellington Shields, wrote in a research report: "The US stock market is like a 'poor' that cannot find its way. A healthy market requires higher participation, but the US stock market lacks such participation."

The US stock market did not respond to the inflation report released last Friday (June 28). The year-on-year increase in the US May PCE price index was 2.6%, lower than 2.7% in April. As a result, the two-year US Treasury bond yield, which is an indicator of the Federal Fund rate, fell from a high of 4.74% to 4.67%. The mild inflation report seems to increase the probability of interest rate cuts, but as the focus of the stock market shifts from interest rates to concerns about economic growth, the S&P 500 index rose only 0.1% last Friday.

Seema Shah, senior global investment strategist at Principal Global Investors, said: "Investors' mentality suddenly changed and they began to pay attention to economic data and began to think that the Fed's interest rate cut may not be a good thing. The interest rate cut may be because the US economy will enter recession."

It can be imagined that this may prompt investors to continue to invest in large technology companies, especially the "seven giants". Last week, the "seven giants" performed well, with five of the seven stocks rising, THis includes the CKH Holdings, which fell by 2.4%, and one that fell by 0.6%. These stocks perform well when the economy is booming, but they also perform well when the economy slows down because their growth is less dependent on the economy than on larger themes such as artificial intelligence. In addition, the decline in interest rates will increase the value of their future profits.$NVIDIA (NVDA.US)$But there are many reasons for concern about technology stocks, the most obvious of which is their valuation. The S&P 500 Information Technology Sector Index has a price-to-earnings ratio of 33.5 times calculated based on expected profits in the next 12 months, which is 43% higher than the low point in October last year, and may have already absorbed expectations of profit growth and interest rate cuts.$Microsoft (MSFT.US)$In summary, investors may face a "cruel summer".

Editor/Emily