Asset Management Weekly Market Commentary

Market updates for the week ending
June 5, 2026

Key observations

• U.S. equity indices ended the week in the red, with the S&P 500 ending an impressive nine-week winning streak as weakness at the top of the market was too much to overcome. Abroad, emerging market indices came under pressure as selling in recent AI winners stateside spilled over into related names in South Korea, specifically, leading to a sizable weekly drop in the MSCI EM index.
• Rotation out of some of this year’s biggest AI-winners was evident throughout the balance of the week with capital finding its way into both ‘defensive’ and economically sensitive sectors, with financials, health care, and industrials standing out as some of the biggest gainers. The May nonfarm payrolls report surprising to the upside on Friday put additional upward pressure on Treasury yields and further weighed on information technology valuations into the weekend.
• Market participants recalibrated expectations for the path forward for monetary policy in the U.S. on the heels of the stronger May payrolls report, and Fed funds futures are now pricing in a 100% likelihood of at least one 25-basis point hike before year-end. Treasury yields across the curve rose into the weekend, creating tough sledding for investment-grade bonds, which tend to be more interest rate sensitive. Lower quality high yield credits fared a bit better, benefitting from shorter duration profiles and higher yields which helped offset the rise in rates.

What we're watching this week

• U.S. Consumer Price Index (CPI) for May is released Wednesday, with the headline reading expected to rise 0.5% month over month and 4.2% year over year. Core CPI, which excludes volatile food and energy prices, is expected to rise 0.3% month over month and 2.9% year over year. Market participants will likely be keenly watching this release on the heels of the strong May payrolls report and should the month over month reading come in ‘light’ versus the consensus estimate as we expect, Treasury yields could reverse Friday’s rise and move lower.
• U.S. Producer Price Index (PPI) for May is released Thursday, with Final Demand PPI expected to rise 0.7% month over month, which would be a notable deceleration from the 1.4% reading in April.
• The University of Michigan releases its preliminary Consumer Sentiment survey for June on Friday. The reading is expected to improve modestly to 46.0 from 44.8 the prior month, while remaining entrenched in worrisome territory. The expectations components of the survey will be worth monitoring to gauge how higher energy prices are impacting 5- to 10-year inflation expectations.