CWS Market Review – July 7, 2026

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We’re at an odd moment for the financial markets. Not much is going on right now, but soon, a lot will be going on. Last week, we got the June jobs report, and there’s still some fallout after it because the report was not very encouraging.

Apparently, the “no-hire, no fire” economy appears to be still at work. One of the odd aspects of this economy is that the unemployment rate is only at 4.2%. That’s quite low. In normal times, that would be celebrated. Not now.

Last month, the U.S. economy created half the number of jobs expected. The jobs report was probably enough for the Fed to delay, but not cancel, its plans for an interest-rate hike.

We’ll get the minutes of the last Fed meeting tomorrow. This was the first one under the stewardship of new Fed chairman Kevin Warsh. He’s already streamlined the Fed’s policy statements.

Where are we as far as the stock market goes? For the last six months, the stock market has been mostly flat except for two short and brief selloffs. There could be a third waiting in the wings. As we know, the market loves to “retest” levels of previous support. So far, the bulls have been willing to push back on any drop, but I wonder how long that can last. The headlines may soon change.

We won’t get the CPI report until next week, but I imagine that the falling price for oil will also help push back its plans for a rate hike. Not that long ago, the price for oil was creeping up to $120 per barrel. Lately, it’s been less than $75 per barrel.

The S&P 500 market pulled back again today but it’s still above its 50-day moving average, and it’s not far from another all-time high. Yesterday, the Dow closed at a new all-time high. The two indexes have diverged in recent weeks. Since the middle of May, the Dow is up 6.5% while the S&P 500 is up just 0.8%.

Since the start of June, the Nasdaq Composite had performed worse than both the Dow and the S&P 500. This is probably due to the market having taken a more defensive posture. Value stocks have also outperformed since the start of June. It’s been a long time since value stocks were hot.

Value had a nice run in 2022. Outside that, value has had a rough time of it over the last 20 years.

Chip stocks have performed especially poorly in the last few days. Intel (INTC) fell nearly 10% today. The ETF to follow for this sector is the aptly named VanEck Semiconductor ETF (SMH). Don’t feel too bad about the semiconductor stocks. In the last 15 months, SMH has more than tripled.

In today’s trading, utilities and REITs both did better than the overall market. The desire for higher yielding stocks dovetails with the Fed’s desire to hold off raising interest rates. It’s hard to make a case that we need to raise interest rates as jobs are growing and oil prices are falling. The futures market currently sees one rate hike coming by Halloween.

The Best-Performing Stock of All-Time

I recently got Meb Faber’s new book, Investing in America: The Rise of a 250-Year Bull Market. I love market history, so it’s no secret that I really enjoyed Meb’s book. I highly recommend it. Here’s a brief snippet I thought you might enjoy on the best-performing stock of all time.

What is the best-performing stock of all time?

Hank Bessembinder, who authored the famous academic paper, “Do stocks outperform treasury bills?” found the answer in his paper “Which US stocks generated the highest long-term returns?”

Eighty stocks had returns of over 500,000% in their lifetime, but only one had a total percentage gain of 265,528,901%. If you had invested $1,000 in the stock in 1925, it would be worth over $25 billion by the end of 2023. What was it?

Some may guess Berkshire Hathaway (BRK-B), but that was only a 792,053% return. Microsoft (MSFT) offered up a paltry 622,498%.

No, the actual winner was Altria (MO)!

Most people probably assume that the best performing stock returned something like 30% or 50% per year. Only six stocks out of the top 100 had returns of over 20% per year. In fact, most of the best performing stocks had returns in the mid-teens. That’s not shabby, of course, and it’s better than the broad index, but not like the eye-popping returns you seeing being advertised on Instagram.

The key is just that they did it for a very long time. The challenge with holding these winners is the path. If you held one of the best performing stocks over the past years, chances are it had a 70% or 80% or even 90% draw down. Could you sit through it?

Here’s how Altria has done since 1980. See that flat red line? That’s actually a 7,000% gain for the S&P 500. Only compared with Altria does it look like nothing.

I remember reading once about a stock (I think it was EMC) that a man owned. He sold his position without realizing that the stock had split. As a result, he still had a few thousand shares left. The stock took off. It gained something like 75,000% in the 1990s. He was informed that he had acquired a nice fortune in EMC.

(Update: I found a link to the story. I wasn’t dreaming it.)

The obvious question is, was he better off not knowing? I think many people would have sold out their position long before. Investing is one of the few pursuits where not doing anything can be a big advantage.

That’s all for now. Short issue this week, but that won’t last. Next Tuesday, July 14, we’ll get the CPI report for June. It will also be the unofficial kick off for Q2 earnings season. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Posted by on July 7th, 2026 at 5:44 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.