Weekend Update, May 26th, 2026

Eight-Week Streak, Dow Record, Inflation Rates Cool

Key Takeaways Last Week

U.S. stocks rose for an eighth straight winning week. The S&P 500 gained +0.9%, the Dow gained +2.1%, the Nasdaq gained +0.5%, and the Russell 2000 gained +2.7%. Year to date, the S&P 500 is up +9.2%, Dow +5.2%, Nasdaq +13.3%, and Russell 2000 +15.6%.

• The Dow closed at a new record high of 50,579.
• The S&P 500 posted its longest weekly winning streak since late 2023.
• Earnings beats supported risk appetite.
• Treasury yields eased late in the week after the 10-year yield moved back to near 4.57%.
• Geopolitical focus stayed on U.S.–Iran talks and the Strait of Hormuz, with oil still near $96–$103/bbl.

U.S. Stock Performance – Index and Sector Moves

Financial markets improved during the week ending 5/22/26. Data Seeking Alpha.

The S&P 500 closed at 7,473, the Dow at 50,579, the Nasdaq at 26,343, and the Russell 2000 at 2,869.

Sector leadership continued in semiconductors and high-growth technology. Sector leadership broadened modestly, with health care, real estate, software, off-price retail, and select AI infrastructure names leading. Health care rose about +3.4% for the week, its best weekly showing in roughly six months.

AI Capex

The current AI/semiconductor rally continues to draw comparisons to the Dot.com period from October 1998 to March 2000, when semiconductor and networking stocks dramatically outperformed during the internet infrastructure buildout. The similarity today is narrow leadership and powerful semiconductor momentum; the key difference is that today’s leading AI companies generally have stronger earnings and cash flow.

S&P 500 Weekly Leaders and Laggards Ranked

• Top Performers (WTD / best available data):
  Dell Technologies (DELL) – Strong earnings, accelerating AI-server demand, and upbeat enterprise infrastructure commentary drove shares sharply higher. Investors focused on expanding AI server backlog.
• Qualcomm (QCOM) – Benefited from improving AI smartphone demand, edge-AI optimism, and stronger momentum tied to AI-enabled devices and enterprise connectivity.
• NetApp (NTAP) – Stronger cloud-storage demand and positive AI data-management commentary.
• HP Inc. (HPQ) – Better-than-expected earnings and improving PC refresh-cycle expectations tied to AI.
• Ford (F) – Stronger pricing trends, resilient truck demand, and investor sentiment around hybrids.

Bottom Performers (WTD):
Nvidia (NVDA) – Pulled back after an extended AI-driven rally as investors took profits ahead of earnings and rising Treasury yields pressured high-multiple semiconductor names. Despite the decline, AI demand commentary remained fundamentally strong.

• Alphabet (GOOGL) – Weakened amid concerns around AI monetization costs, regulatory pressure, and valuation sensitivity as long-term Treasury yields rose.
• Intuit (INTU) – Declined after guidance and margin commentary disappointed investors despite generally solid earnings. Concerns centered around slowing small-business demand and valuation pressure.
• Advanced Micro Devices (AMD) – Semiconductor rotation pressured shares despite favorable long-term AI trends. Investors rotated into lower-multiple infrastructure and enterprise names.
• Super Micro Computer (SMCI)– Volatile AI-server momentum.

Breadth & Participation

Breadth improved modestly but remains uneven. Small caps outperformed, with the Russell 2000 gaining +2.7% for the week, suggesting some participation beyond mega-cap tech.

Still, leadership remains concentrated in AI, software, cybersecurity, health care, and select earnings winners.

International/Global

International markets improved into the weekend as optimism grew around a potential U.S.–Iran framework and reopening of the Strait of Hormuz. Japan’s Nikkei rose sharply, and European markets also gained after oil prices retreated on deal hopes.

Volatility & Risk Sentiment

Risk sentiment improved as bond-market pressure eased and earnings remained strong.

VIX: 16.68

Bonds, Credit & Interest Rates

Treasury yields rose sharply. The 2-year Treasury yield ended at 4.09%, and the 10-year ended near 4.59%, both the highest since February 2025. 30-year Treasury yield hit 5.13%, highest closing level since July 2007.

Credit conditions remain stable, but higher rates are tightening financial conditions.

Economic Data, Monetary Policy & Earnings

Consumer sentiment fell to a record low of 44.8 in May, down from 49.8 in April, driven by gasoline prices, Middle East tensions, and inflation worries.

Earnings remained the market’s biggest support.

Consumer Stress Commentary

Consumer stress remains concentrated among lower-income households. Gasoline prices averaged about $4.55/gallon ahead of Memorial Day, up sharply from pre-war levels.

Off-price retail strength at Ross suggests consumers are trading down rather than stopping spending entirely.

Commodities, Currencies & Macro Assets

Brent crude: ~$103.54/bbl
WTI crude: ~$96/bbl
Gold: $4530/0z
Dollar Index: 99
Bitcoin: ~$77,800
Ethereum: ~$2,138

Liquidity Conditions

Flows & Positioning

Equity liquidity remained supportive, especially for large-cap technology, cybersecurity, software, and health care. Treasury liquidity improved late in the week as yields eased.

What Matters This Week

Markets will focus on:
· April PCE inflation
· Treasury auctions and long-end yields
· U.S.–Iran deal progress and oil prices
· Nvidia, Dell, Salesforce, Costco, HP, and Marvell earnings
· Whether small-cap and equal-weight participation continues

Bottom Line

Markets extended their winning streak to eight weeks as earnings strength, easing yields, and U.S.–Iran deal optimism outweighed weak consumer sentiment. The Dow hit a new record, and the S&P 500 moved closer to its highs. The rally broadened modestly, but leadership remains heavily tied to AI, software, cybersecurity, and earnings winners.

Stock Talk

Interest Rates, A Headwind not Roadblock to your Growth Stock Investments

AI remains the dominant earnings story, and the Iran conflict the geopolitics story, but overall economic growth has accelerated after a 1q26 slowdown and growth stocks continue to lead the S&P500’s rally.

Past performance is no guarantee of future results. Indexes are unmanaged and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. The preceding discussion is for informational purposes only. Investing involves risk and no reference to any security listed above should be considered a buy or sell recommendation. Advisory services are provided through Oak Harvest Investment Services, LLC, a registered investment adviser.