Market Update: May 26, 2026

Markets pushed higher last week despite a mixed macro backdrop, underscoring the resilience of risk assets in the face of lingering uncertainty.

Economic data painted a nuanced picture, with softening housing activity and declining consumer sentiment offset by mixed PMI readings across manufacturing and services. Still, investors looked past the noise, focusing instead on easing geopolitical tensions and the potential for lower energy prices.

U.S. equities extended their rally, with the S&P 500 logging its eighth consecutive weekly gain, the longest streak in three years. Market leadership broadened, as cyclical value and small caps outperformed, while defensive sectors like utilities and healthcare led overall gains. Interestingly, even strong earnings from Nvidia failed to ignite further upside, suggesting elevated expectations are already priced into AI-driven names.

Globally, equities followed suit. Europe and the U.K. advanced on optimism surrounding Middle East negotiations, while emerging markets saw strength in AI-linked semiconductor exporters like Taiwan and South Korea. China, however, remained a drag amid ongoing growth concerns.

Fixed income markets provided a tailwind, as Treasury yields retraced recent highs, supporting both U.S. and international bonds. Meanwhile, commodities declined, led by a sharp drop in crude oil prices, down nearly 9%, as geopolitical risk premiums eased.

Looking ahead, focus shifts toward inflation data, particularly the Fed’s preferred PCE measure, alongside key housing and late-cycle earnings reports. With valuations elevated and macro crosscurrents still in play, the sustainability of this rally may hinge on confirmation that inflation, and rates, are indeed stabilizing.

The information above has been obtained from sources considered reliable, but no representation is made as to its completeness, accuracy or timeliness.  All information and opinions expressed are subject to change without notice.  Information provided in this report is not intended to be, and should not be construed as, investment, legal or tax advice; and does not constitute an offer, or a solicitation of any offer, to buy or sell any security, investment or other product.