WARSAW, August 16, 2026, 13:26 CEST
- The S&P 500 closed Friday just 0.4% under the record set on Thursday.
- Technology funds saw $4.62 billion in outflows even as demand for growth funds persisted.
- Upcoming retail earnings reports and the release of Fed minutes will gauge if the rally has room to expand.
The U.S. stock market starts the new week showing a notable divergence. The S&P 500 stays close to its all-time high, while technology funds have recently experienced significant outflows.
Technology funds saw outflows of $4.62 billion through Wednesday. Meanwhile, growth equity funds recorded inflows totaling $8.78 billion, marking the biggest addition since November 2024. The split indicates persistent demand, though investors are showing greater selectivity.
| Friday market measure | Verified level | Friday move | Weekly signal |
|---|---|---|---|
| S&P 500 | 7,785.76 | -0.17% | +0.4%; marks third weekly advance |
| Nasdaq Composite | 26,729.16 | -0.28% | +0.1%; up for third week running |
| Dow Jones Industrial Average | 53,732.41 | -0.20% | Failed to hold Thursday’s high close |
| U.S. 10-year Treasury yield | 4.688% | +4.72 basis points | Pressure from real yields persists |
| Brent crude | $88.52 a barrel | +1.67% | Inflation risk remained heightened |
Corporate profit expansion underpins the index. Nearly 85% of 456 S&P 500 firms surpassed quarterly forecasts. Excluding mark-to-market gains from two major technology firms, earnings increased by 32.7%.
Valuations offer less cushion. The S&P 500 is trading close to 20 times forecast earnings, compared to roughly 19 at the end of July. Even robust results may disappoint if investor expectations are elevated.
Semiconductor stocks saw similar activity on Friday. According to portfolio manager Thomas Martin, different segments of artificial intelligence continue to propel the market. He cautioned that his concern centered on expectations rather than on demand.
| Weekly fund category | Net flow | Investor message |
|---|---|---|
| U.S. equity funds | +$2.58 billion | Inflow followed previous week’s $1.36 billion withdrawal |
| Growth equity funds | +$8.78 billion | Biggest intake since November 2024 |
| Value funds | +$1.79 billion | Signaled wider appetite for risk |
| Technology funds | -$4.62 billion | Broke a six-week streak of inflows |
| Bond funds | +$9.40 billion | Top inflow seen in four weeks |
| Money-market funds | +$13.92 billion | Demand for liquidity stayed strong |
The earnings focus moves to households and housing this week. Home Depot NYSE:HD is scheduled to report on Tuesday. Lowe’s NYSE:LOW and Analog Devices NASDAQ:ADI are set to release results on Wednesday. Walmart NYSE:WMT will post its earnings on Thursday. All dates have been confirmed by the companies.
| Date | Catalyst | Primary market test |
|---|---|---|
| Tuesday, August 18 | July housing starts; industrial production; Home Depot earnings | Housing demand, cyclical momentum |
| Wednesday, August 19 | Fed minutes; results from Lowe’s and Analog Devices | Interest rate outlook, home improvement and semiconductor demand |
| Thursday, August 20 | Weekly jobless claims; Walmart earnings | Job market strength, consumer expenditure |
| Friday, August 21 | Preliminary U.S. purchasing manager readings | August economic activity and pricing trends |
The housing report for Tuesday is due at 08:30 EDT, with industrial production figures set for release at 09:15. The Federal Reserve is scheduled to release minutes from its July meeting Wednesday at 14:00.
The minutes could clarify the discussion, yet they were released before Friday’s disappointing retail sales data. By the end of the week, markets priced in a 67% chance of rates remaining unchanged in September, while the other 33% suggested an increase.
| Named analyst | Verified view | Recommendation for the week |
|---|---|---|
| Shawn Snyder, economic strategist | Market action driven mainly by earnings as Fed communication gives limited direction | Focus on guidance and cash-flow signals |
| Andy Pratt, investment strategist | Company beats and upbeat forecasts continue to fuel risk-taking | Back firms with upgraded outlooks |
| Chris Grisanti, chief market strategist | AI investment is still underpinned by robust balance sheets | Maintain allocation, but check efficiency of capital deployment |
| Thomas Martin, portfolio manager | Elevated expectations could overshadow a strong quarter with guidance lift | Resist following crowded trades after earnings |
Economic strategist Shawn Snyder noted that investors are relying more heavily on earnings to navigate the market. Investment strategist Andy Pratt highlighted broad upside guidance among companies. Both experts believe this outlook is positive for equities, provided that earnings results match current valuations.
Clear evidence would be if retailers, housing demand, and market breadth all showed strength at the same time. An advance supported by these areas would lessen the reliance on a narrow group of AI leaders.
Risks: Another surge in oil prices could raise inflation expectations and push the 10-year yield higher. Disappointing retail outlooks may highlight the valuation disparity at all-time high indices.
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