graphical user interface, application by Anne Nygård courtesy of Unsplash.

Weekly Market Update

John Walsh |
Categories
Market Update
Wealth Management
Financial Planning
By John P. Walsh, CRPC | Managing Partner, The Wealth Advisory Group, LLC Week Ending May 29, 2026
 
It was a holiday-shortened week, but the markets didn't take time off. U.S. equities pushed to fresh highs, the S&P 500 tacked on roughly 0.9%, and the Nasdaq continued to ride momentum from AI investment and strong corporate earnings. What made this week different? Risk appetite held firm even as inflation data came in hotter than expected — a sign that investors are increasingly willing to look past near-term noise as long as the growth story stays intact.
 

Stocks: Confidence Is Holding Up

Large-cap growth and technology led the way again. The rally has been narrow in terms of leadership, but it hasn't weakened — and that distinction matters. Portfolios with exposure to quality growth and AI-related themes continue to benefit, while diversification across styles remains important for managing valuation risk if rates stay elevated longer than expected.

Bonds: Income, Not Protection

Treasury yields stayed elevated, with the 10-year hovering in the mid-4.5% range. Markets are now pricing in a meaningful probability of another Fed rate hike later this year, and the "higher-for-longer" narrative has firmly taken hold.

What does that mean practically? Bonds are doing a good job generating income right now, but they're not acting as the traditional shock absorber many investors are used to. That makes portfolio construction more intentional — shorter-to-intermediate duration strategies are favored over long-duration exposure in this environment.
 

Inflation & the Fed: The Conversation Has Shifted

April's PCE inflation report showed headline inflation at 3.8% year-over-year, with core inflation ticking higher as well. Fed officials continue to push back on rate-cut expectations, and the market conversation has shifted from when cuts begin to whether another hike is on the table. The silver lining: much of this is now priced in, which takes some of the sting out of hawkish headlines.

Energy: A Bit of Relief

Oil prices pulled back as geopolitical tensions in the Middle East showed modest signs of easing. Energy remains volatile and headline-driven, but the retreat helped take some pressure off the inflation picture at the margin.

The Bottom Line

The current environment still supports selective risk-taking — but discipline matters. Income is attractive, equity momentum is intact, and inflation risks argue for balance over concentration. If you're wondering whether adjustments make sense given where rates and markets stand today, that's exactly the kind of conversation we have with our clients every day.

Want to talk through how this affects your situation? Book an appointment here.