This Weekly Financial Markets Update reviews the top market headlines: Higher Energy Prices Pressure CPI in May, Markets Flip from Rate Cuts to Rate Hikes, AI Leaders Eye IPO Market
  • The Consumer Price Index rose 4.2% over the prior year in May
  • Financial markets estimate a more than 50% chance of a Fed rate hike before the end of 2026
  • Anthropic's latest private valuation is approximately $965 million

Top Three Market Headlines

Higher Energy Prices Pressure CPI in May: The U.S. Department of Labor reported last week that the Consumer Price Index (CPI) rose 0.5% over the month of May, a slightly slower pace than reported in March and April (0.9% and 0.6%, respectively). Over the past 12 months the index rose 4.2%, the largest increase in three years. The key factor driving the index higher in May was energy items, which rose 3.9% and accounted for over 60% of the monthly increase. Excluding the volatile food and energy categories, however, the "core" CPI increased just 0.2% on the month, down from a 0.4% pace in April, which translated to a 2.9% rise on a year-over-year basis.

Markets Flip from Rate Cuts to Rate Hikes: Financial markets are beginning to price in at least one interest rate hike by the Federal Reserve before the end of 2026, a change from earlier in the year when rate cuts were widely expected. As of last week, markets assigned a greater than 50% probability of at least one quarter-point rate hike this year, based on the pricing of federal funds futures contracts, according to the CME Group FedWatch tool. This revised outlook has gained traction in recent months amid higher inflation readings and stronger-than-expected jobs reports.

AI Leaders Eye IPO Market: Artificial intelligence (AI) companies OpenAI and Anthropic, the makers of AI chatbots Chat GPT and Claude, respectively, each recently confidentially filed for an initial public offering (IPO), with expectations of going public sometime in the fall of 2026. The two companies may each achieve a $1 trillion public market valuation, based on their recent private market valuations, which would make them the largest pure-play AI companies offered to investors. These public offerings would extend the string of AI-related companies going public, following the recent IPOs of AI semiconductor chip maker Cerebras Systems and SpaceX.

As of June 12, 2026 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World 0.61% 14.03% 10.38% 25.28%
S&P 500 0.66% 14.10% 9.15% 24.44%
Russell 2000 3.93% 18.17% 19.22% 39.31%
MSCI EAFE 0.97% 10.27% 8.90% 20.22%
MSCI Emerging Markets 0.02% 23.41% 23.21% 45.34%
FTSE NAREIT Equity 2.36% 12.55% 17.95% 19.88%
Bloomberg Commodity -2.34% -3.60% 19.94% 30.28%
Bloomberg U.S. Aggregate 0.52% 0.39% 0.35% 4.47%

U.S. Bureau of Labor Statistics 6/10/2026, CME 6/12/2026, TechSpot 6/9/2026, Zacks 6/10/2026. Data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory services are offered by Gallagher Fiduciary Advisors, LLC ("GFA"), an SEC registered investment advisor that provides retirement, investment advisory, discretionary and independent fiduciary services. Registration as an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the SEC. GFA is a limited liability company with Gallagher Benefit Services, Inc. as its single member. GFA may pay referral fees or other remuneration to employees of Arthur J. Gallagher & Co. or its affiliates or to independent contractors; such payments do not change our fee. Neither Arthur J. Gallagher & Co., GFA, their affiliates nor representatives provide accounting, legal or tax advice. GFA does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your GFA consultant before acting upon any information or recommendation contained herein to discuss the ability of the information/recommendation for your specific situation.