NEW YORK, May 10, 2026, 13:03 EDT
S&P 500 and Nasdaq hit new highs as Wall Street starts the week, and that leaves little margin for disappointment on inflation, consumer spending, or the oil market, still unsettled by the Iran war. On Friday, the S&P 500 closed up 0.84% at 7,398.93. Nasdaq jumped 1.71% to 26,247.08. The Dow Jones Industrial Average, barely moving, ended 0.02% higher at 49,609.16, according to Reuters.
Buyers are back, no question. Last week, the S&P 500 climbed 2.3%, while the Nasdaq jumped 4.5%. Both notched record closes Friday, lifted by a jobs report that beat expectations, according to AP.
Inflation takes the spotlight next. On Tuesday, the U.S. Labor Department will publish April’s consumer price index at 8:30 a.m. ET. Producer price index figures—tracking what producers are getting paid—follow Wednesday, also at 8:30 a.m. ET. Then, April retail sales data from the Commerce Department’s Census Bureau is on deck for Thursday, 8:30 a.m. ET.
Investors are eyeing whether gasoline and energy price jumps start seeping into broader inflation. April CPI is forecast to climb 0.6%, cooling from March’s 0.9% jump, according to a Reuters poll. The core CPI, which excludes food and energy, could hold more sway over rate bets. Kristina Hooper, chief market strategist at Man Group, noted markets had “focus[ed] on only the positive.” Michael Arone of State Street Investment Management called earnings “the lifeblood of this rally.” mint
It comes down to the Fed: if core CPI beats, bets on high rates get stickier. Reuters reports traders see the Fed keeping things at 3.50%-3.75% through December. Rob Williams, chief investment strategist at Sage Advisory Services, put it bluntly—the economy “seems hard to wreck.” Investing.com
Earnings remain the main driver. Cisco has its third-quarter fiscal 2026 numbers coming out after Wednesday’s close, while Applied Materials is on deck for its fiscal Q2 call Thursday. Investors are watching these updates closely after last week’s surge in Nvidia, Micron, and Sandisk—an AI-heavy cluster that’s powered the tech trade.
There’s also the consumer angle. According to Investopedia, results from Under Armour, On Holding, Birkenstock, and Klarna are scheduled this week, so expect attention on apparel, footwear, and buy-now-pay-later categories just ahead of retail sales figures. If gas prices remain elevated, that retail data could take on extra significance, especially if households begin cutting back on non-essential purchases.
China’s making a return to the market calendar. The Ministry of Commerce confirmed Vice Premier He Lifeng is set to head a delegation for trade talks with U.S. officials in South Korea, scheduled for May 12-13. All this comes just before President Donald Trump is expected in China later this week, according to Reuters.
Chips, rare earths, and Boeing are all in play at the upcoming Trump-Xi meeting. With the visit slated for May 14-15, Reuters says trade, Taiwan, and the Iran war are on the table. U.S. officials want a shot at Chinese rare earths and key minerals, while Beijing is pushing to roll back American semiconductor export restrictions.
Iran is still the wild card. The country delivered its answer to a U.S. proposal—meant to stop the war that’s dragged on for over two months—via mediator Pakistan, according to Iran’s IRNA news agency on Sunday. Sources speaking to Reuters say the negotiations are focused on a short-term deal: a pause in fighting and resumed movement through the Strait of Hormuz.
The setup remains tricky. A stubborn CPI reading, another spike at the pump, or stalled progress in Hormuz negotiations could send investors back into the inflation trade, spelling trouble for pricey growth names. Gasoline costs have only climbed, turning into “a larger budget item,” D.A. Davidson’s James Ragan told Reuters. mint
Profits still outweigh jitters for investors at the moment. That tends to stick—at least until new numbers force a different call.
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