August 6, 2026

Stocks traded sharply higher for a second straight session, powering the S&P 500 to its first record high since June. Optimism around Washington striking an interim deal with Tehran to help restore oil shipments through the Strait of Hormuz fueled the risk-on mood, aiding some market broadening sparked by a strong batch of earnings across sectors. Labor turnover is lower than normal as firms slow the pace of hiring. Elsewhere, the short end of the Treasury curve rose while monthly ADP employment change data missed expectations.

 

Topics of the week: 

  • Strong Corporate Profits: Companies continue to deliver better-than-expected earnings, providing a solid foundation for stock market gains.

  • AI Supporting Growth: AI-related investments are helping drive profit growth and remain an important long-term opportunity for businesses.
     

What we are watching:

  • Middle East Uncertainty: Ongoing tensions involving Iran and disruptions to global shipping routes could keep energy prices elevated.

  • AI Spending Questions: Investors remain concerned about whether large AI investments will generate sufficient returns.
     

 

Index Data & Market Performance

 

Data as of Market Close  8.4.26 

source: gemini.google.com*

In Focus

Alongside economic data, corporate earnings are shaping stock price action. SpaceX reported its highly anticipated debut earnings as a public company on Tuesday. Other major corporations reporting throughout the week include tech and semiconductor firms like AMD and Palantir, healthcare giant Eli Lilly, and consumer bellwethers like Disney, McDonald's, and Uber.

Key Reports:

Tuesday – JOLTS Job Openings, U.S. Trade Balance

Wednesday – ADP National Employment Report

Thursday – Weekly Initial Jobless Claims

Friday – U.S. Employment Situation Report (Nonfarm Payrolls)
 

What's Trending: Reaching New Heights

 

  • The combination of resilient economic growth, strong corporate earnings, and AI-driven investment continues to provide a favorable backdrop and opportunities for equities to reach new heights. It is important to understand the following: 
    We maintain our year-end fair value S&P 500 target range of 7,650 to 7,750, based on our 2027 S&P 500 earnings per share forecast of $350. 
  • The Iran conflict is not over. Shipping disruptions in the Persian Gulf are affecting more than just oil, introducing lingering inflation risks, and increasing the possibility of a Fed rate hike in September. 
  • Periods of volatility tied to geopolitics, monetary policy, the AI debate, or the upcoming midterm elections are likely. 
  • We continue to believe AI-powered earnings will persist. This earnings strength will continue to provide a solid floor for stocks in the second half, and potentially some upside as well, driven largely by AI investment. At the same time, a resilient economy will provide support for non-AI earnings, which we expect to grow double-digits through 2026 and into 2027. 

     


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Disclosures

*The data for the total returns of the S&P 500, Dow Jones 30, and NASDAQ Composite are compiled and published by several financial news outlets, index providers, and government/academic sources.

Based on typical financial data providers and the search results, here are the likely sources for this data:

  • S&P Dow Jones Indices (S&P Global): This is the official index calculator for the S&P 500 and the Dow Jones Industrial Average (DJIA). They publish index data, including total returns, in daily, weekly, and monthly reports/commentary.
  • Nasdaq Global Indexes: They are the official index calculator for the NASDAQ Composite. They also publish fact sheets and performance reports with total return data.
  • Financial News Agencies and Publications: News outlets like The Associated Press (AP) and financial publications like Investopedia regularly report on the daily, weekly, and year-to-date (YTD) returns of these major U.S. indexes.
  • Federal Reserve Economic Data (FRED) / St. Louis Fed: FRED, maintained by the Federal Reserve Bank of St. Louis, is a public resource that often includes daily closing levels for indices like the S&P 500, which can be used to calculate returns.
  • Financial Data Platforms (e.g., Bloomberg, YCharts, MSCI): Professional and commercial financial data providers often republish or calculate returns based on the official index data for their clients.