Stocks closed mostly lower on Friday with only the Nasdaq eking out a small gain. But that still resulted in another new all-time high and close.

The indexes closed mixed for the week. The Nasdaq, S&P 500 and small-cap Russell 2000 closed up for the week, while the Dow and the mid-cap S&P 400 finished lower for the week (but not by much).

It's been a solid couple of weeks for the economy and the market.

Inflation (both CPI's retail inflation and PPI's wholesale inflation) came in better-than-expected, and the market cheered the news.

The Fed has sat on rates since the start of the year on fears of rising inflation due to tariffs. But inflation has actually fallen over the last several months with core annual rates sitting at or near multi-year lows.

While that's unlikely to give the Fed the green light to cut rates next week when they meet on July 29-30, it does bode well for a rate cut sooner rather than later. (There's only 4 FOMC meetings left this year (July, September, October and December). And the Fed is still projecting two rate cuts (presumably by 25 basis points each) this year.

Whether the rate cutting cycle resumes in July or September or later, since the market is forward looking, and the data is supportive for rate cuts, the market appears to have begun pricing it in already.

Earnings season has also gotten off to a great start. Big bank earnings have come in better-than-expected. Some AI tech names have done the same. (Tech also got a boost last week after NVIDIA was given the go-ahead to sell their H20 chips to China.)

We'll get another 609 companies on deck to report this week, including 2 Magnificent 7 stocks: Alphabet and Tesla.

Next week we'll get as many as 966 companies set to report, along with 3 other Mag 7 stocks: Microsoft, Meta and Apple.

Cryptocurrencies got some good news last week as well after the House of Representatives passed the Genius Act, which was passed by the Senate last month, and sets standards for stablecoins, which is a type of cryptocurrency that's pegged to another asset. The President signed it into law on Friday. Additionally, the House passed two other bills: one that goes over rules for crypto exchanges and brokers, how they will be regulated, and by which agency; the other bill bans central-bank digital currencies. They next head to the Senate.

In other news, on Friday the Housing Starts and Permits report showed Starts rising to 1.321 million units (annualized) vs. last month's 1.263M and views for 1.300M. Permits rose as well, coming in at 1.397M vs. last month's 1.394M and estimates for 1.380M.

And Consumer Sentiment improved, increasing to 61.8 vs. last month's 60.7 and the consensus for 61.4. The year-ahead inflation expectations also improved, coming in at 4.4% vs. last month's forecast for 5.0% and views for the same.

The market is off to a good start in the second half. And YTD, the indexes are all in the green with the Dow up 4.25%, the S&P up 7.06% and the Nasdaq up 8.21%.

But I'm expecting even better things for the rest of the year. In fact, I'm expecting another 20% gain this year. And given the S&P is 'only' up 7.06%, that potentially means another 13% gain from here.

So make sure you're taking full advantage of it.

See you tomorrow,