May Funds Show April Was No Fluke

Tech continued its climb back into the black during the month, and natural resources and precious metals are holding up well

The market's postwar advance picked up momentum in May, as headlines about Iraq receded and economic and corporate profits reports improved. Another spark came from the Federal Reserve's policymakers, who surprised the market on May 6 by saying they're concerned about deflation. Since then, market gurus have been hanging on Greenspan & Co.'s every word for clues as to whether the Fed will cut interest rates soon to give the economy an extra push. For the month, the average diversified equity fund jumped 7%, beating the 5.2% return for S&P 500-stock index (for full results for more than 9,000 funds, see BW Online's Interactive Mutual Fund Scoreboard).

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