Market Recap: Volatility Returns

Week ending June 14, 2025

Markets pulled back this week after a two-week rally, capped by a sharp Friday selloff driven by renewed geopolitical tensions. The Dow Jones Industrial Average dropped by 1.3%, while the S&P 500 and NASDAQ both posted modest declines. The retreat followed gains earlier in the week as investors digested inflation data and bond auctions before sentiment shifted late in the week.

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🌍 Key Market-Moving News

Middle East tensions escalated dramatically after Israeli military strikes targeted Iranian nuclear facilities. This spurred a sharp rise in oil prices, with U.S. crude surging over 11% to hit a four-month high near $73 per barrel. Energy stocks responded strongly, making the energy sector the top performer this week.

Meanwhile, U.S. inflation data came in cooler than expected, with the Consumer Price Index rising just 0.1% in May and 2.4% year over year. This calmed fears about inflation’s trajectory, even as tariffs remain elevated.

Gold continued its breakout, rallying 3.3% on the week to settle around $3,450 per ounce—an all-time high and nearly 30% higher year to date.

Investor demand for long-dated Treasuries also returned. A strong 30-year bond auction helped stabilize yields, with the benchmark 10-year settling around 4.41%.

Elsewhere, U.S. consumer sentiment rebounded sharply, rising from 52.2 to 60.5 according to the University of Michigan’s early June survey. Participants reported reduced concern about inflation, contributing to a cautiously optimistic tone.

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