DFG Navigator Archives | May 2026

Your Capital Markets Snapshot: AI Rally Drives Six-Week Win Streak

US markets extended their rally to a sixth consecutive week, with stocks rising to fresh records as signs of labor-market strength drove equities higher. The S&P 500 gained on the week, bolstered by speculation that the world's largest economy remains resilient in the face of an energy shock triggered by the Iran war. Treasury yields declined modestly across the curve, as mixed economic data reinforced expectations the Federal Reserve will stay on hold. Gold rose for the week, supported by central-bank buying and safe-haven demand amid Middle East tensions, while WTI crude oil fell despite ongoing geopolitical uncertainty. US employersadded 115,000 jobs in April, beating the 65,000 jobs forecasters had expected, though the unemployment rate remained at 4.3%. Consumer sentiment fell to a record low of 48.2 in May from 49.8 in April, as concerns about inflation's impact on personal finances and buying conditions weighed on households. Last week's market performance reflected a tug-of-war between economic resilience and elevated uncertainty, leaving investors navigating a complex environment of solid growth data against persistent geopolitical and inflation concerns.

Your Capital Markets Snapshot: Markets Hit Records Amid Energy-Driven Inflation

US markets extended their rally during the week, with major indices reaching fresh records as investors looked past geopolitical tensions and focused on strong corporate earnings from technology giants. The S&P 500 ended the week higher, marking its fifth consecutive weekly gain and longest winning streak since late 2024, driven by resilient earnings and signs of economic strength. Treasury yields climbed across the curve as war-induced inflation concerns and robust manufacturing data dimmed expectations for near-term Federal Reserve rate cuts. Oil prices rose for the week as the Iran conflict continued to disrupt global supply. The PCE (personal consumption expenditures) price index increased 0.7% in March—the fastest monthly pace since mid-2022—drivenprimarily by a 21% surge in gasoline prices, pushing the year-over-year PCE rate to 3.5%. At last week’s FOMC (Federal Open Market Committee) meeting, the Federal Reserve held its benchmark interest rate steady in the range of 3.5%-3.75%. Overall, markets demonstrated remarkable resilience in navigating elevated geopolitical risks while corporate fundamentals remained solid, though inflation pressures from energy costs present ongoing challenges for investors and policymakers alike.

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