A Fête Sans Tech

Global financial markets experienced a broad-based positive week, with the U.S. equity market rising over 1% despite a 71-basis-point decline in the technology sector. Energy and consumer staples led performance, signaling a rotation in market sentiment. Fixed income markets saw a modest relief rally as investors sought advantage in 20-year high yields, while the U.S. dollar maintained resilience against developed market currencies. Economic data revealed a robust services sector, though rising prices continue to weigh on consumer sentiment, which has been impacted by a 30% cumulative inflation rate over the past six years. FOMC minutes suggest a hawkish stance, with participants favoring further rate hikes as a risk management tool against persistent inflation. Attention now shifts to the upcoming "Inflation Week," where critical CPI, PPI, and retail sales data will provide further clarity on the trajectory of the U.S. economy.