The US and Iran have signed a memorandum of understanding to extend the ceasefire between the two countries and reopen the Strait of Hormuz. The agreement envisions a 60-day period on the path to a permanent peace deal.
This development boosted optimism in the markets at the start of the week and caused oil prices to fall. US crude oil lost about 10% of its value over the course of the week.
Fed Chair Warsh's Inflation Statement
Federal Reserve Chair Kevin Warsh, in a press conference following the June meeting, stated that the Fed maintains its commitment to bringing inflation down to its 2% target. Warsh shortened the policy statement and announced the creation of a series of task forces to reshape the agency.
The prospect of Fed officials anticipating a possible interest rate hike to combat persistent inflation caused a wave of selling in the markets on Wednesday. The S&P 500 index posted its worst performance since 1994 on the first 'Fed day' under a new chair.
Gains for Chipmakers
Chipmaker Intel gained 10.6% on Thursday, reaching record levels, after former President Donald Trump announced that Apple's semiconductor company would work on chip development and design in the US. Intel's weekly gain was 7.6%.
Nvidia and Broadcom also gained 2.9% and 4.7%, respectively. Arm reached an all-time high with a gain of nearly 5%. Over the week, Nvidia rose 2.7%, Broadcom rose 7.7%, and Arm rose 15.4%.
The iShares Semiconductor ETF (SOXX) gained approximately 7.3% over the same period.
Stock Market Closes Week Higher
Markets were closed on Friday due to the Juneteenth holiday. In the shortened four-session trading week, the S&P 500 index rose 0.9%, closing higher in 11 of the last 12 weeks. The Nasdaq index gained 2.4%.
On Thursday, the S&P 500 rose 1.1% and the Nasdaq rose 1.9%. These gains offset the declines in the previous session caused by concerns over the Fed's monetary policy.
