Inflation Stings, but Wall Street Strikes Back:
Stocks ended the week mixed as stronger-than-expected inflation data weighed on investor sentiment, offsetting gains fueled by chipmaker stocks.
The S&P 500 Index rose 0.13%, while the Nasdaq Composite Index edged down 0.08%. The Dow Jones Industrial Average lost 0.17%. The MSCI EAFE Index, which tracks developed overseas stock markets, declined 1.77%.1,2
Source: Bloomberg Finance, L.P. (Performance data normalized 05/8/26 = 0)
Volatile Week
Stocks ticked up to start the week, helping the S&P 500 close above 7400 for the first time. The Nasdaq also closed at a new high as chipmaker stocks continued to lead the tech sector.3
Markets opened lower on Tuesday after the Consumer Price Index (CPI) report came in hotter than expected. Stocks pared the losses by the close, with the Dow Industrials managing to notch a slight gain.4
SThe rally continued, with the S&P and Nasdaq hitting new intraday and closing records over the next two trading days. On Thursday, a strong Q1 report from a megacap tech company helped pace gains while investors kept one eye on the ongoing U.S.-China meetings. The S&P 500 closed over 7,500 for the first time, while the Dow reclaimed the 50,000 level.5,6
Stocks were under pressure from the opening bell on Friday. Treasury yields rose as the three-day summit between U.S. and Chinese leaders came to a close. Investors seemed disappointed that there were no major agreements in the Middle East conflict.7
Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab
Inflation in Focus
Both retail and wholesale inflation rose faster than expected in April, heavily influenced by higher energy prices.
The CPI increased 3.8% year over year in April, up from 3.3% in March. Fuel oil alone climbed 54% year over year, while gasoline jumped 28%. In fact, over 40% of the 0.6% month-over-month gain was driven by energy inflation.8
Inflation also showed up in wholesale prices. The Producer Price Index rose 6% over the prior 12 months in April, also a 3-year high. Month over month, PPI rose 1.4% (a 4-year high) versus the 0.5% increase expected.9
This Week: Key Economic Data
Source: Bloomberg Finance L.P.
This Week: Companies Reporting Earnings
Source: EarningsWhispers
Author
Gary Aiken
Chief Investment Officer
Concord Asset Management
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Footnotes and Sources
1WSJ.com, May 15, 2026
2Investing.com, May 15, 2026
3CNBC.com, May 11, 2026
4WSJ.com, May 12, 2026
5CNBC.com, May 13, 2026
6CNBC.com, May 14, 2026
7CNBC.com, May 15, 2026
8WSJ.com, May 12, 2026
9CNBC.com, May 13, 2026
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