📊 Market Summary
- NASDAQ: 19,615.88 (-0.50%)
- S&P 500: 6,022.24 (-0.27%)
- Dow Jones: 42,865.77 (Flat)
- USD/KRW Exchange Rate: 1,370.80 (+0.26%)
Major U.S. indices saw a modest retreat following three straight days of gains. With inflation cooling and progress in trade talks with China, markets entered a consolidation phase, particularly with tech stocks seeing some profit-taking.
📰 Key News and Highlights
- 🥇 May CPI Shows Easing Inflation
- May CPI rose by 2.4% YoY and Core CPI by 2.8%, both slightly lower than April.
- Month-on-month CPI was up just 0.1%, bolstering expectations of a potential Fed rate cut.
- 🤝 U.S.-China Trade Talks Yield Framework Agreement
- Senior officials from the U.S. and China met in London and reached a tentative framework on key trade issues.
- While details are limited, both sides hinted at possible tariff rollbacks and easing restrictions on rare earth exports.
- 🌍 Geopolitical Risks Rising in the Middle East
- The U.S. announced a partial evacuation of its embassy in Iraq amid heightened security threats.
- Escalating tensions involving Saudi Arabia and Iran added to investor caution.
- 📉 Bond Yields Drop as Inflation Expectations Cool
- The 10-year Treasury yield fell to 4.41% (-7bps), reflecting investor demand amid softer CPI and renewed rate cut hopes.
- 💻 Tech Stocks Lead the Pullback
- The NASDAQ declined 0.5%, driven by modest declines in Apple, Amazon, Google, Nvidia, and Meta.
- However, Broadcom (+3%) and Microsoft (slightly higher) provided some counterbalance in the sector.
🔮 Outlook & Key Upcoming Events
- June 12 (Thu): May PPI release
- June 13 (Fri): University of Michigan Consumer Sentiment (preliminary)
- Mid-June: Potential follow-up in U.S.-China trade discussions
- June 17–18: FOMC Meeting (key for rate direction)
Markets remain sensitive to macroeconomic data and geopolitical shifts. Upcoming data points will shape the Fed's tone and investor sentiment.
💡 Conclusion & Investment Strategy
📌 Takeaway
The May CPI figures confirmed a cooling inflation trend, reviving optimism about a potential Fed pivot. However, ongoing geopolitical risks and tech sector profit-taking signaled a short-term balancing act for markets.
📌 Strategy
- Inflation-sensitive assets: Consider TIPs and long-duration bonds
- Tech rotation opportunities: Watch for entry points on quality tech pullbacks
- Defensive sectors: Increase exposure to consumer staples, healthcare, and utilities
- Geopolitical hedging: Diversify with gold and oil-linked assets
- Staggered entries: Position ahead of key releases like PPI and consumer sentiment
📝 Closing Note
Today’s market behavior reflects “balance within correction.” Inflation may be easing, but trade uncertainty and geopolitical tensions remain unresolved. Investors should stay nimble, balancing macro risks with strategic exposure to growth.