Market Report, 2026-05-15

This week’s topics largely centered around AI, China, and oil. As has become increasingly common over the past few years, AI-driven earnings continued to provide investors with confidence. The investment theme has remained unstoppable, as large corporations operating in the space continue to ramp up their infrastructure investments. Furthermore, a U.S. delegation to China, comprised of the President, high-ranking officials, and top business leaders, further boosted expectations for corporate profits, as the market anticipates the possibility of more American chips being sold to Chinese companies. Nevertheless, the end of the week saw stock rallies come to a halt as inflation continued to impact the global bond market.

Stocks closed the week flat, with significant sector rotation. The Dow and S&P 500 ended the week nearly unchanged at 49,526 and 7,409, respectively. The NASDAQ slipped 0.55% to 29,125. Energy stocks retook the spotlight, ending the week 6.73% higher, while consumer discretionary, real estate, and materials stocks each finished the week more than 2.5% lower.

As inflation readings came in higher than expected and demonstrated persistent upward pressure, the bond market is now pricing in the possibility that global central banks may hike interest rates to combat inflation. Long-term investors are also bidding up long-term rates globally. The 5-year U.S. Treasury yield rose 15 basis points to 4.26%, while the 10-year yield rose nearly a quarter percentage point to 4.6%. The 30-year yield reached 5.12%, a level not seen since mid-2007.

Industrial reports have been strong, demonstrating meaningful expansion.

With inflation still elevated, we will be watching how new Federal Reserve Chair Kevin Warsh implements his plan to lower rates while shrinking the balance sheet. Next week’s Nvidia earnings report will also be in the spotlight.

Adams Wealth Advisors will keep you informed. Enjoy your weekend.