S&P 500 Finishes Little Changed as Higher Oil and Yields Spook Investors

Performance for Week Ending 5.15.2026:

The Dow Jones Industrial Average (Dow) lost 0.2 percent, the Standard & Poor’s 500 Index (S&P 500) added 0.1 percent, and the Nasdaq Composite Index (Nasdaq) dipped 0.1 percent for the week ending May 15. Sector breadth was negative with seven of the 11 S&P sector groups closing lower. The energy sector was the strongest (6.8 percent), while consumer discretionary (-3.1 percent) was the weakest.

*See below for Index Definitions

MARKET OBSERVATIONS: 5.11.2026–5.15.2026

The S&P 500 finished the week with a modest gain, but it was still enough to mark the seventh consecutive week the broader market index closed higher. Trading was volatile as stocks bounced between gains and losses during the week as investors digested economic, earnings, and geopolitical news. A rebound in oil prices and a backup in Treasury yields also weighed on investor sentiment.

Powell Out, Warsh In: Last week, the Senate confirmed Kevin Warsh as the Federal Reserve's (Fed) next chair in a 54–45 vote, handing President Trump a long-sought victory. The vote reflected the partisan divides that have increasingly defined Washington and now extends to the Fed, whose chairs have traditionally enjoyed wide margins of bipartisan support. The narrow confirmation margin could complicate Warsh's ability to project independence from the White House—a perception key to the Fed's credibility. By comparison, Powell received at least 80 votes both times he was confirmed.

Fed Speak: Boston Fed President Collins said she envisions a prolonged stretch of steady interest rates and could envision a scenario that requires some policy tightening to ensure inflation returns to the central bank's 2 percent target. Collins also indicated that it will likely be necessary to maintain the current restrictive monetary policy "for some time." Chicago Fed President Goolsbee said the recent inflation readings show pervasive price pressures in the U.S. economy and may even indicate an overheating. “If you look at the components that are not energy, like services, if that is an indication that the underlying economy is overheating then the Fed has got to be thinking about how do we break the chain of escalating inflation,” Goolsbee said. Kansas City Fed President Schmid said the fundamentals of the U.S. economy are sound, but inflation is still too high. “I see continued inflation as the most pressing risk to the economy,” Schmid said.

Q1 Earnings Recap: Through Friday May 15, 454 companies in the S&P 500 have released first quarter results, with over 81 percent beating expectations. Aggregate earnings for this group are up just over 25 percent from a year ago, solidly ahead of the 12.4 percent projected at the end of March. Reflecting the solid results, analysts have revised first quarter earnings expectations higher and now expect 27.5 percent growth for the quarter. At the sector level, communication services and consumer discretionary have posted the biggest upside surprises and the strongest growth. According to Bloomberg, analysts expect S&P 500 earnings to grow by 22.6 percent for the full year, and by 14.7 percent in 2027.

Economic Roundup: Consumer prices rose 0.6 percent in April, according to data released by the Bureau of Labor Statistics, in line with expectations and below March's 0.9 percent increase. The inflation measure rose 3.8 percent year over year, exceeding expectations of 3.7 percent and March's 3.3 percent reading. The core Consumer Price Index, which excludes the volatile food and energy categories, rose by 0.4 percent from the previous month and 2.8 percent over the previous year. Both readings were above economists’ expectations of 0.3 percent month over month and 2.7 percent year over year. On the labor front, the number of Americans seeking jobless aid increased last week, yet figures remain historically low despite economic uncertainty stemming from the ongoing conflict in Iran. Applications for unemployment benefits in the United States rose by 12,000 to 211,000 for the week ending May 9. Meanwhile, retail sales in April rose for the third straight month, with analysts saying the increase largely reflected higher prices as the war in Iran kept fuel costs elevated. Sales rose 0.5 percent in April following a revised 1.6 percent gain in March, the Census Bureau reported, matching the consensus in a survey compiled by Bloomberg. Gasoline station receipts climbed 2.8 percent last month after a nearly 14 percent jump in March. Food and beverage store sales increased 0.8 percent following a 1 percent rise the prior month, while electronics and appliance stores posted a 1.4 percent gain after 1.3 percent in March.

Outlook—The Trend Remains Our Friend: While the outlook through the end of the year remains favorable, tactically the parabolic move off the March 30 trough has left the market in an overbought state, a condition that usually precedes a period of consolidation. Based on what we feel remains a supportive macroeconomic environment, with a resilient economy, solid earnings growth, and a Fed that is still likely to cut rates at least once later this year, we would view any setbacks in the market as a good buying opportunity.

The Week Ahead: The corporate earnings calendar will be in focus this week with the spotlight on AI bellwether Nvidia on Wednesday. Other reports of interest include retailers Walmart, Home Depot, and TJX. It will be a relatively quiet week in terms of data releases with Thursday’s S&P manufacturing and services Purchasing Managers Index reports being the focal point. Also of interest will be pending home sales, jobless claims, and housing starts. There will be five Fed speaking events this week with Fed Governor Waller presenting on both Tuesday and Friday. The Fed is also scheduled to release the meeting minutes from the April Federal Open Market Committee meeting on Wednesday.

— By Michael Schwager, Chief Market Strategist, Managing Director

Definitions

The Dow Jones Industrial Average is a price-weighted average of 30 blue-chip stocks that are generally defined as the leaders in their industry. It has been a widely followed indicator of the stock market since Oct. 1, 1928.

Standard and Poor's 500 Index is a capitalization-weighted index of 500 stocks. The index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

The Nasdaq Composite Index is a broad-based capitalization-weighted index of stocks in all three Nasdaq tiers: Global Select, Global Market and Capital Market. The index was developed with a base level of 100 as of Feb. 5, 1971.

This material contains opinions of the author, but not necessarily those of Guggenheim Partners, LLC or its subsidiaries. The opinions contained herein are subject to change without notice. Forward looking statements, estimates, and certain information contained herein are based upon proprietary and non-proprietary research and other sources. Information contained herein has been obtained from sources believed to be reliable, but are not assured as to accuracy. Past performance is not indicative of future results. There is neither representation nor warranty as to the current accuracy of, nor liability for, decisions based on such information. No part of this material may be reproduced or referred to in any form, without express written permission of Guggenheim Partners, LLC.