The Numbers
The S&P 500 eked out its seventh consecutive weekly gain, rising just 0.3% to close at 7,408.50 — a sharp deceleration from the big moves of recent weeks. The Nasdaq finished the week up 0.3% as well, closing at 26,225.15. The Dow slipped 0.05% to 49,526.17. All three indexes surged to record highs on Thursday — the Dow crossed 50,000 for the first time ever, the S&P 500 closed above 7,500 — only to give it all back on Friday, falling more than a full percentage point across the board.
What's Driving It
Inflation came in hot — twice. The week's defining data was not in earnings but in the inflation prints. April's Consumer Price Index rose 3.8% year over year, above estimates. The Producer Price Index was even uglier, coming in at 6.0% annually — the highest reading since December 2022. Both reports sent Treasury yields spiking. The 10-year note finished the week at 4.59%, its highest level in a year. The 30-year hit 5.12%, a level not seen since 2007. Odds of a Fed rate hike this year jumped from essentially zero a month ago to 45% by Friday.
Warsh takes the wheel. Jerome Powell's term as Fed chair ended Friday, May 15. Kevin Warsh — confirmed by the Senate 51-45 on a mostly party-line vote — officially takes the helm. His first FOMC meeting is scheduled for June 16-17. Warsh enters with a market that is pricing in rate hikes rather than cuts — not the environment any incoming Fed chair wants. Schwab's head of fixed income research put it plainly: "It will be very difficult for him to argue for lower rates when inflation has reaccelerated."
Cerebras explodes on debut. The week's biggest single-stock story was Cerebras Systems, which surged 68% on its first day of trading Thursday, nearly touching a $100 billion valuation for a company with just over $500 million in 2025 revenue. AI infrastructure enthusiasm remains intense even as macro conditions tighten.
China summit disappointed. Trump left Beijing after two days of talks with Xi having touted "fantastic" deals — but no major agreements were announced. Markets had hoped for progress on Iran. None came. The disappointment partly drove Friday's selloff, as investors reassessed whether the geopolitical overhang on oil and inflation has any near-term resolution.
Other Stories
Chip stocks had a volatile week. Nvidia hit an all-time intraday high Tuesday before pulling back. Qualcomm fell 13% — its worst session since 2020 — after the CPI print sent investors into risk-off mode. The semiconductor ETF dropped 5% on Tuesday alone before recovering. Vestis surged 30%+ on a strong earnings beat. Zebra Technologies popped 17% on better-than-expected Q1 results.
Starbucks confirmed 300 corporate layoffs, its third round of cuts this year, with $400 million in restructuring charges. Verizon also announced a new round of layoffs following its historic 13,000-employee reduction earlier in the year. Both companies cited cost optimization in the face of an uncertain macro environment.
What to Watch
Nvidia Q1 earnings — Wednesday May 20. The most anticipated report of the quarter
Home Depot earnings — Tuesday May 19. A consumer spending barometer
Kevin Warsh's first signals as Fed chair — any hint of hawkishness will move markets
Oil and Iran — Brent above $109. No ceasefire progress means no relief on inflation
Works Cited
Schwab. "Stock Market Update." Charles Schwab, May 15, 2026.
Schwab. "Weekly Trader's Stock Market Outlook." Charles Schwab, May 16, 2026.
Edward Jones. "Weekly Stock Market Update." Edward Jones, May 2026.
CNBC. "Stock Market Today Live Updates." CNBC, May 12, 2026.
Manulife John Hancock Investments. "Weekly Market Recap." Manulife, May 2026