Fed hawkishness, Iran truce and Micron set to move S&P 500

The S&P 500 remained under pressure after a Federal Reserve policy statement that traders described as hawkish. A 60-day ceasefire between the United States and Iran pushed global crude prices below $80 a barrel. Investors are focused on Micron Technology’s quarterly report and the May Personal Consumption Expenditures price index due Thursday.

The Fed’s language lifted U.S. Treasury yields. The two-year Treasury yield climbed to its highest level in years, placing strain on rate-sensitive stocks and on broad-market ETFs such as VOO and SPY. Traders reduced risk positions after the statement, and the index moved in step with company earnings, including a retreat following Broadcom’s results.

Diplomatic developments between the U.S. and Iran produced large swings in oil markets. The two sides agreed to a 60-day ceasefire that included sanctions relief for Iran, the unfreezing of some U.S. assets and commitments by Gulf countries to invest more than $300 billion over time. The agreement included a pledge that Israel would halt bombing in Lebanon and the reopening of the Strait of Hormuz, allowing Iranian crude to flow to world markets. Brent and West Texas Intermediate futures fell below $80 a barrel after the agreement. Late in the week, Iran said its delegation would not travel for talks over the Lebanon issue and briefly closed the Strait of Hormuz, lifting oil prices.

Corporate earnings remain a market driver. Micron reports results on Wednesday; its market value has approached the $1 trillion range. Memory-related companies have been among the top performers in the S&P 500, including Sandisk, Western Digital and Seagate. Other S&P 500 firms reporting this week include Paychex, Darden Restaurants and FedEx.

On the economic calendar, the May PCE price index is set for Thursday. Economists project headline PCE rose 4.0% year-over-year in May, up from 3.8% in April, while core PCE, which excludes food and energy, is forecast to remain at 3.3%. The PCE measure covers a broader slice of consumption than the Consumer Price Index. Because the Fed issued its rate decision last week, market participants are treating the report as material for market reaction rather than an immediate driver of policy change.

Investors will watch whether the ceasefire holds, how Micron’s results reflect demand for memory products, and whether the PCE data point to persistent inflation pressures.