The S&P 500 and the Nasdaq composite each notched a third consecutive weekly advance to record highs, as a string of favorable inflation reports offset concerns surrounding stalled peace talks involving Iran and the strait of Hormuz.
The S&P 500 eased less than 0.2% on Friday but logged a weekly climb of 0.4%. The Nasdaq finished down 0.3% on Friday but up 0.1% last week. The Dow Jones Industrial Average fell 0.2% on Friday, and ended with 0.6% weekly loss.The small-cap Russell 2000 index notched a Friday gain of 0.5%, and rose 1.1% for the week.
The market’s advance was aided by earnings reports from artificial intelligence hardware names Lumentum (LITE), CoreWeave (CRWV) and Nebius (NBIS), and bullish Sandisk (SNDK) guidance. Meanwhile, AI titans Nvidia (NVDA) and SK Hynix (SKHY) also had strong gains.
West Texas Intermediate crude oil futures rose 5.4% to $82.40 last week. It was the largest one-week percentage gain since the week ending July 24, per Dow Jones Market Data.
In the bond market, the 10-year Treasury yield rose more than 5 basis points to 4.69%, moving back near its recent highs. The 30-year yield climbed to 5.2%, highest level since 2001, as investors weighed the implications of a growing federal deficit.
In the coming week, earnings reports include those from big retailers Walmart (WMT), Target (TGT) and Home Depot (HD), which will offer clues into the health of the U.S. consumer.
On the economic front, minutes from the Federal Reserve’s (Fed’s) latest policy meeting are due Wednesday. Further in the distance is the Fed’s Jackson Hole symposium at the end of the month. That will be the next major opportunity for policymakers to provide guidance on monetary policy, inflation trends and economic growth.
Please click here for the Looking Ahead report written by Wells Fargo. It contains interesting graphs, tables, and charts. Below are excerpts from that research.
Week in review: August 10-14
Economic news
- July‘s CPI and core CPI came in largely as expected, with headline inflation at 3.4% year-over-year (Y/Y) and core inflation at 2.5% Y/Y. The relatively subdued readings, reduced pressure on the Federal Reserve (Fed) to raise interest rates at its September meeting.
- Energy and gasoline prices declined month-over-month (M/M) for a second consecutive month, while grocery prices also moved lower as lettuce prices fell sharply and ground beef prices posted their largest monthly decline since 2020.
- Shelter and services inflation remained modest, rising 0.1% and 0.2% M/M, respectively. In contrast, prices for computer software and accessories continue to decline, increasing a record 21.2% year-over-year (Y/Y).
- The producer price index (PPI) was unchanged from June to July but slowed on a Y/Y basis, rising 4.7% Y/Y compared with 5.5% Y/Y in June.
- Prices for final demand goods declined 0.7% M/M, while final demand services increased 0.2% M/M.
- Most of the decline in the goods measure was attributable to lower gasoline prices.
- Small business optimism rose 2.4 points to 99.8 in July, supported by stronger hiring intentions and spending plans, signaling continued confidence among small businesses despite ongoing labor market challenges.
- Labor shortages remain a key constraint, with 36% of firms reporting unfilled positions, while capital spending plans increased to 25%, their highest level in nearly two years.
- Existing home sales fell 1.7% M/M to a seasonally adjusted annual rate of 4.06 million in July, remaining near historically low levels. Elevated mortgage rates continue to weigh on affordability and dampen demand, while the median home price rose 2.0% Y/Y to $434,100 further limiting the pool of prospective buyers.
- July retail sales unexpectedly fell 0.6% M/M, marking the sharpest decline since May 2025.
- A 0.4% decline in the control group measure, combined with a downward revision to June’s reading, suggested underlying consumer spending softened at the start of the third quarter.
Looking ahead to this week: August 17 to 21
U.S.
- Investors will focus on July industrial production and housing starts early in the week before turning their attention to the minutes from the Fed’s July meeting. Later, the spotlight will shift to S&P Global’s August Purchasing Managers’ Indexes (PMIs) for the manufacturing and services sectors, July import and export price index, and the Conference Board’s index of leading economic indicators.
- Rounding out the week are reports on August home builder sentiment and July pending home sales.
- Investors will also be monitoring the August 19 implementation of a 50% U.S. tariff on approximately $20 billion of Canadian imports.
Asia
- In China, investors will focus on July industrial production, retail sales, fixed-asset investment, home prices, the surveyed unemployment rate, along with August one- and five-year loan rate rates.
- In Japan, key releases include second-quarter Gross Domestic Product (GDP), August manufacturing and services PMIs, July national CPI and trade balance data, June readings on the Tertiary Industry Index, core machine orders, and final industrial production.
- Elsewhere in the region, Australia will release August consumer confidence and PMI data, second quarter wage growth figures, and July labor market data.
Europe
- The highlights will include August PMI data, the Eurozone’s final July CPI reading, second-quarter negotiated wages, August, consumer confidence, and the ZEW survey of economic expectations.
- In the United Kingdom, investors will be watching August manufacturing and services PMIs, consumer confidence, and house price data, along with July CPI, PPI, retail sales, and labor market reports.
- Elsewhere, Germany will release its August ZEW current conditions index and July PPI, while France will report August manufacturing confidence and June retail sales data.
