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Recap | Week Ahead | Key Drivers Thumbnail

Recap | Week Ahead | Key Drivers

“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.” – William Arthur Ward 

 Last Week's Market Recap: 

  • The S&P 500 closed the week up 1.54%. Year-to-date the index is up 2.62%
  • NASDAQ closed the week up 2.20%. YTD the index is up 1.44%
  • U.S. Aggregate Bond index closed the week down -.44%. YTD the index is up 2.00%
  • 10-Year Treasury Rate increased, ending the week at 4.51% up from 4.41% the prior week
    • Fed Funds Target rate remains at 4.25-4.50%
  • The 1-Year Treasury is yielding 4.15%  
  • A 6 Month Treasury is yielding 4.30%  

 

The week ahead:  

  • Inflation Data (CPI)
  • Consumer Sentiment 
  • Apple Developer’s Conference

 

Comments: 

U.S. equity markets extended their recovery last week, buoyed by resilient economic data and easing trade tensions. 


Key Market Drivers:  

  • Labor Market Remains Resilient
    • The U.S. labor market continues to show strength. The unemployment rate is holding steady at 4.2%; however, there are early signs of softening, as job openings have increased but continuing jobless claims have reached a cycle high, and some downward revisions were made to previous months’ employment data. 
  • Corporate Earnings and Valuations
    • While 2025 earnings growth estimates for the S&P 500 have been revised down, the outlook for 2026 remains steady, suggesting continued corporate strength in the medium term. Valuations have returned to elevated levels, which could leave less room for error as economic growth decelerates. 
  • Policy and Trade Developments
    • Trade tensions have eased in recent weeks, contributing to improved investor sentiment. Attention is shifting toward the potential for more stimulative fiscal and monetary policies in 2026, although the Federal Reserve remains data-dependent and has signaled caution on the timing of any rate cuts. 
  • Global Perspective
    • International equities have also performed well, with some large-cap international markets outpacing the S&P 500 since the April lows. The broad global rally reflects both easing trade concerns and solid corporate earnings worldwide. Global equities were also boosted by a large decline in the U.S. dollar which is unlikely to continue at the recent magnitude.

 The recent market rally has been supported by solid fundamentals, including a resilient labor market and healthy corporate profits. However, elevated valuations and early signs of economic softening suggest a more cautious approach may be warranted. Most investors should maintain a diversified portfolio, as markets navigate upcoming economic and policy tests. Slight adjustments could be made into quality equities as well as short term investment grade credit.

Source: BlackRock Weekly Market Commentary


As always, let us know if you have any questions.


Best, 

CRA Investment Committee


Matt Reynolds CPA, CFP®

Tom Reynolds, CPA 

Robert T. Martin, CFA, CFP®

Gordon Shearer Jr., CFP® 

Jeff Hilliard, CFP®, CRPC®

Joe McCaffrey, CFP® 

Phillip Tompkins, CFP®


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