U.S. Stock Indices Rise Amid Hopes of Slowing Inflation: U.S. stock indices rose amid hopes of slowing inflation,
bolstering expectations that the Federal Reserve might cut interest rates this year.
Data showed that American consumers expect inflation to reach 3.3% in the coming year, compared to previous expectations of 3.5%.

Content

Stock Indices Performance
Inflation Slowdown Expectations
Financial Markets Performance

Bond and Currency Market Performance

Consumer Spending

Monetary Policy
Stock Trajectory

Business Activity

Key Indices Performance

Stock Indices Performance

The S&P 500 index surpassed the 5300-point level, reversing last week’s losses,
while the Nasdaq 100 reached an all-time high, led by Apple and Nvidia stocks.

Inflation Slowdown Expectations

Data from the University of Michigan showed that American consumers

expect prices to rise at an annual rate of 3.3% in the coming year,
down from the earlier expectation of 3.5%. Jeff Roach from LPL Financial stated that consumers are no longer
as pessimistic about the inflation trajectory, indicating a potential slowdown in consumer spending,
which might ease demand-side inflationary pressures.

Financial Markets Performance

In a session marked by low trading volumes, the S&P 500 index climbed past the 5300-point level,
shedding last week’s losses, while the Nasdaq 100 hit a record high led by Nvidia and Apple stocks.
Prices of crypto-related company stocks also rose as the Securities and Exchange Commission paved
the way for the final launch of the first U.S. exchange-traded funds investing directly in Ether.

Bond and Currency Market Performance

Yields on 10-year U.S. Treasuries fell by one basis point to 4.46%, with the bond market closing early before Memorial Day.
The dollar halted a four-day winning streak, while the yen fluctuated after Japan’s top
currency official reiterated a stance against excessive moves. Oil and gold prices increased.

Consumer Spending

Consumer expectations shrank in May amid increasing signs of weakness in the labor market.
Consumers realized that interest rates might remain higher for longer, affecting overall sentiment.
Jim Baird from Plante Moran Financial Advisors noted that the key question is whether consumers
will continue spending or start cutting back in anticipation of more stringent measures.

Monetary Policy

Minutes from the Federal Open Market Committee meeting showed that participants viewed monetary policy as “well-positioned,”
but many officials indicated readiness for further tightening if necessary.
Goldman Sachs economists revised their forecast for the first rate cut to September instead of July,
citing the need for better inflation numbers and significant signs of weakness in economic activity or labor market data.

Stock Trajectory

Florian Ielpo from Lombard Odier Asset Management indicated that corporate earnings remain strong despite high interest rates,
suggesting that the impact of what is usually seen as positive economic news might be less clear.
He noted that companies might continue passing inflation costs to consumers,
with the basic expectation being a continued rise in profit margins.

Business Activity

Michael Hartnett, a strategist at Bank of America, warned that the global stock market rally is at risk of exhaustion.
The bank’s so-called global breadth rule indicates that about 71% of stock indices
are moving above their 50-day and 200-day moving averages, with a reading above 88% triggering a sell signal.

Key Indices Performance

The S&P 500 rose by 0.7% at 4 p.m. New York Times.

The Nasdaq 100 climbed by 1%.

The Dow Jones Industrial Average remained steady.

Bitcoin increased by 2.1% to $69,175.88.

Ether dropped by 0.3% to $3,746.38.

U.S. Stock Indices Rise Amid Hopes of Slowing Inflation

U.S. Stock Indices Rise Amid Hopes of Slowing Inflation

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