US Equity Markets hit all-time highs last week, as interest rates fell despite worse-than-expected inflation data that led to a nice bounce in technology-related shares. The S&P 500 rose 0.4% for the week to bring its gains for the year to 13.1%. The Nasdaq rallied 1.9% for the week thanks to strength in technology stocks and is now up 9.2% for the year, while the Russell 2000 (small cap stocks) was up 2.2% for the week to bring its gains to 18.3% for the year.
Global Equity Markets inched higher last week as positive economic data out of Europe encouraged investors. Developed Markets increased 0.3% for the week and are now up 11.2% for the year. Emerging Markets were flat for the week and remain up 7.0% for the year.
US Inflation Data continued to come in hotter than forecast. The Consumer Price Index (CPI) rose 5.0% year-over-year in May, its biggest increase since 2008, while Core CPI excluding energy and food costs rose 3.8%, the largest increase since 1992. Over the last six months, total CPI is running at an annualized rate of 5.8%, while Core CPI is running at a 4.0% annualized rate.
Of Interest to Us
US Interest Rates dropped notably last week despite the high inflation data. The yield on the US 10-Year Treasury fell to 1.45% from 1.55% the prior week. This tells us that investors believe that the current elevated inflation levels will indeed prove to be temporary, as the Federal Reserve has advocated. We remain focused on wage inflation, which likely will be key in whether inflation is going to be more than temporary.
Market Data
for the week ending 6/11/2021
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