Market Recap for Week Ended May 24:
Market Recap Ended May 24
Bond price rally
Prices of U.S. government bonds rose sharply, sending their yields lower, as investors focused on indicators of moderating economic growth. After reaching a seven-year high of 3.11% on May 17, the yield of the 10-year U.S. Treasury bond sank below the 3.00% threshold on Thursday and finished the week around 2.93%.
Fed minutes
The potential for an interest-rate hike in June grew after the U.S. Federal Reserve on Wednesday released the minutes from its latest meeting. The minutes said that Fed board members generally agreed that “it would likely soon be appropriate” to approve another rate hike if the economy continues to grow as expected. The Fed’s next meeting is June 12–13.
Emerging-markets downturn
The recent strength of the U.S. dollar has weighed on emerging-market stocks, making it more costly for other countries to service debt denominated in dollars. As of Friday, an emerging-market index was down about 11% from its level of late January.
Source: John Hancock Investments