Week in Review: May 8, 2026

May 11, 2026

Recap & Commentary

Markets ended the week higher with the S&P 500 at a new record high, as the index notched its 6th consecutive week of gains, its longest such streak since 2024. The Middle East remained a focal point for investors along with first quarter earnings.

News out of the Middle East continued to focus on the prospects of a longer-term peace plan, with much of the week having an on again, off again quality to it. While equity markets were more muted in their reaction, energy prices remained volatile, with US oil prices trading as high as $106/barrel and as low as $89. Higher jet fuel prices, which have nearly doubled in the US since the beginning of March, contributed to the demise of Spirit airlines, resulting in the loss of nearly ~$17K jobs.

Over the weekend, Iran responded the US’s most recent peace proposal. Though the exact terms of the deal were unclear, President Trump described Iran’s response as “totally unacceptable.” The apparent inability of the two sides to reach any sort of deal suggest energy prices will continue to face upward pressure in the near term.

Through Friday, 89% of S&P 500 companies had reported 1Q26 earnings, with 84% of those companies beating their consensus estimate. According to industry group FactSet, consolidated earnings growth for 1Q26 is expected to be 27.7%, which if achieved, would mark the 6th consecutive quarter of double-digit earnings growth. It also marks the highest earnings growth rate since 4Q21.

Economic Commentary

On a headline basis, the April employment report was positive, suggesting improved labor market conditions. Nonfarm payrolls added 115K jobs vs. the consensus expectation of 65K. April also marked the second consecutive month of 100K+ jobs following a net cumulative loss of 112K jobs during the five-month stretch from October 2025 through February 2026. Unemployment remained unchanged at 4.3%. Unlike the positive payroll data, household survey data, used in the calculation of unemployment, showed a loss of 226K jobs. A 0.1% decline in the labor force participation rate to 61.8%, a four-and-a-half year low, helped keep unemployment unchanged. The report, while positive on a headline basis, suggested that overall demand for labor remains relatively tepid. That was corroborated by the March job openings report showing 6.86M jobs available in March, virtually unchanged from February, and near its lowest level since late 2020.

According to industry group Institute for Supply Management (ISM), service sector activity continued to expand at a relatively modest pace in April. New orders remained positive but slowed from March levels while employment contracted for the second consecutive month. Input prices remained elevated, matching March’s level for the highest reading since October 2022, reflecting increased energy prices.

March new home sales rose for the second consecutive month, reaching a three-month high, aided by a 6.2% year-over-year decline in the median price, which fell to $387K, its lowest level since July 2021.

Consumer sentiment fell to a new record low dragged down by concerns about higher energy prices and resultant higher inflation.

On Note

The US Court of International Trade (CIT) ruled that President Trump’s blanket 10% tariffs enacted in February, following the Supreme Court invalidating a large portion of his April 2025 tariffs, are illegal. However, the CIT’s decision was narrow, pertaining to two private importers and the State of Washington. The ruling does, however, raise the likelihood that other importers will sue for similar relief.

Market Indices (As of 05/08/2026)

Consumer Inflation (CPI)
Producer Inflation (PPI)
Retail Sales
Existing Home Sales
Industrial Production
Small Business Optimism
Initial Jobless Claims

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