U.S. equity markets diverged sharply last week as a renewed sell-off in technology weighed on cap-weighted benchmarks while the broader market continued its rotation higher. The Nasdaq Composite fell 4.6%, the S&P 500 declined 1.9%, and the Magnificent 7 dropped about 5.5%, while the Dow gained 0.6%. A 10% overnight drop in Korea’s KOSPI on Tuesday helped trigger the tech weakness, even as Micron delivered a blowout quarter and reached a new all-time high on Thursday. The dominant macro story was a collapse in oil prices, with WTI falling nearly 10% to around $69/barrel as the U.S.–Iran peace deal held and tanker traffic recovered through the Strait of Hormuz. Economic data was generally constructive: Q1 GDP was revised up to 2.1% (from 1.6%), personal income and spending both rose 0.7%, and S&P Global Manufacturing PMI hit a 49-month high of 55.7. However, the May PCE report showed headline inflation at 4.1% YoY and core PCE at 3.4% YoY, the highest since October 2023. Despite the above target inflation pressures, July rate-hike odds eased some as labor and growth data remained resilient and falling oil prices could result in softening inflation numbers over the coming months. The Fed will be keeping a close eye on the future path of inflation data as they weigh their next move.