Markets Rallied For the Week

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Markets rallied for the week, reversing direction from last week’s drop, despite a fall-off on Friday. Friday’s decline was due to a disappointing reading of the Q2 Employment Cost Index (ECI), which was up only 0.2% versus expectations for a 0.6% increase. Federal Reserve Chair Janet Yellen had recently cited the ECI as a sign of a tightening labor market. Treasuries rallied on the news, while the dollar came under pressure. Volatility persisted in Chinese equity markets, with the Shanghai exchange shedding 8.5% on Monday alone.

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