Your Capital Markets Snapshot: Volatility, Fed on Hold, and Earnings Strength

Capital markets were volatile last week as major stock indices swung between early week gains and a late week pullback driven largely by mixed mega-cap technology earnings. The Federal Reserve held rates steady at 3.50%–3.75%, signaling a slightly more hawkish stance while acknowledging solid economic activity and a stabilizing labor market. The stock market reacted sharply on Friday after President Trump nominated Kevin Warsh as the next Fed chair, a move perceived as modestly dovish relative to Chair Powell. Earnings season remained strong, with more than 90 S&P 500 companies reporting and showing broad-based revenue and earnings growth that reflects continued economic strength. Meanwhile, inflation data surprised to the upside, particularly the PPI report, suggesting potentially stickier price pressures. Small-cap equities underperformed during the week, marking a brief slowdown after an otherwise strong start to the year. Commodities saw significant fluctuations, with gold and silver swinging lower following the Fed chair nomination on Friday, while crude oil pushed to a four-month high. On balance, the week highlighted a market navigating mixed signals yet still showing steady resilience amid elevated volatility.