The S&P 500 rose 1.8%, while the NASDAQ Composite added 2.2%, led by gains in technology and consumer discretionary shares. Fed Governor Michael Hayes noted in a speech on Monday that “inflation has shown encouraging signs of moderation,” and that the committee would be “data-dependent” before considering further rate hikes.
IGS Investment’s Chief Market Strategist, Emma Carter, commented:
“These remarks reinforced the view that the Fed will take a cautious approach. We’ve seen rotation into growth-oriented names, and our sector models have shifted overweight to tech and healthcare in anticipation of lower real yields.”
Earnings updates also supported the rally. Retailer BluePeak reported better-than-expected same-store sales, while semiconductor giant MicroCore beat consensus on both revenue and margins. Energy names underperformed, however, as crude oil prices retreated 3% after a surprise build in U.S. inventories.
Looking ahead, traders will focus on Friday’s May U.S. CPI report and next week’s European Central Bank meeting. IGS Investment’s Weekly Dashboard highlights that volatility remains elevated, and the firm advises clients to maintain diversified exposures with tactical hedges in defensive sectors.