By Amaury de Barros Conti, Partner | Vice President Investments
WHAT MOVED MARKET LAST WEEK
Markets extended their constructive tone last week, supported by resilient economic data, renewed confidence in artificial intelligence–driven earnings growth, and tentative signs of geopolitical stabilization. While crosscurrents remain, particularly around inflation, monetary policy, and geopolitical risk, it appears the prevailing narrative continues to favor risk assets. Importantly, leadership broadened, with small-cap and value stocks outperforming, suggesting improving market depth beneath headline index strength.
U.S. equities finished the week higher, with the Dow Jones Industrial Average reaching a new all-time high and the S&P 500 posting its eighth consecutive weekly gain. Early-week volatility, driven by rising Treasury yields and geopolitical uncertainty, gave way to a more constructive tone midweek. The 10-year Treasury yield briefly climbed to approximately 4.69%, reflecting both shifting inflation expectations and evolving narratives around U.S.-Iran negotiations.
Source: Bloomberg Finance as of May 22, 2026.
- A dominant driver of market sentiment remains the continued strength of the AI investment cycle. NVIDIA’s latest results reinforced the durability of this theme, with margins exceeding expectations and forward guidance implying continued demand acceleration. The company’s projected earnings trajectory, more than doubling year-over-year, underscores the scale of capital deployment currently underway across the digital infrastructure ecosystem.
- Beyond technology, consumer resilience remains a notable offset to macro concerns. Recent retail earnings, including commentary from Walmart, Target, and Ross, suggest stable demand trends, particularly among higher-income cohorts. While survey data indicates rising consumer caution, this has yet to translate into a meaningful deterioration in spending behavior.
- Consumer sentiment deteriorated further, with the University of Michigan index falling to 44.8, its lowest level on record, while inflation expectations continued to rise.
- Geopolitical developments remain a critical swing factor. While negotiations between the U.S. and Iran have reduced near-term escalation risk, outcomes remain uncertain and continue to influence energy markets. Oil price stability has helped support risk sentiment, though any renewed disruption could contribute to inflationary pressure.
LOOKING AHEAD
- The upcoming week will be influenced by several key catalysts, including the release of core PCE inflation, the Federal Reserve’s preferred gauge, expected near 3.3%, alongside a heavy slate of Fed commentary.
- Markets will also focus on technology and consumer earnings, with companies such as Salesforce, Costco, Dell, and Snowflake offering additional insight into demand trends and AI-related capital spending.
Amaury de Barros Conti
Partner | Vice President Investments
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