WEEKLY MARKET RECAP – August 14, 2026

U.S. stock indexes were largely unchanged for the week as the market paused following the previous week’s rally, which had pushed the S&P 500 and Dow to record highs. The S&P 500 and NASDAQ posted fractional gains, while the Dow edged slightly lower.

Concerns about longer-term inflation pressures pushed the 30-year Treasury yield back toward levels last seen two weeks earlier, which were the highest since 2007. By Friday afternoon, the 30-year yield was around 5.26%, while the 10-year Treasury remained elevated at 4.69%. The 2-year yield moved in the opposite direction, slipping slightly for the week to 4.17%.

Recent inflation reports pointed to persistent but gradually easing price pressures. The Consumer Price Index rose at a 3.4% annual rate in July, slightly below June’s 3.5% pace. A subsequent report on producer prices also showed little change in wholesale inflation from the previous month.

Corporate earnings season continued to deliver strong results on both the top and bottom lines. According to FactSet, S&P 500 companies were on track to post second-quarter revenue growth of 15%, the strongest pace since the fourth quarter of 2021. Earnings growth was projected at more than 50%, which would mark the strongest quarterly increase since the second quarter of 2021.

Oil prices moved higher as developments in the Middle East and the Strait of Hormuz continued to influence energy markets. U.S. crude traded above $82 per barrel on Friday afternoon, up from roughly $78 a week earlier. Despite the increase, prices remained below the recent peak above $92 reached on July 23.

U.S. consumer spending showed signs of weakness, with retail sales falling 0.6% in July, the first monthly decline in nine months, following a 0.2% increase in June. A separate report released Friday also showed a decline in consumer sentiment, although inflation expectations remained stable.

Small-cap stocks continued to show relative strength. The Russell 2000 reached another record high on Wednesday, surpassing the peak set just a week earlier, and finished the week up more than 1%, modestly outperforming its large-cap counterparts.

Expectations for a Federal Reserve rate hike in September continued to fade. According to CME FedWatch, futures markets on Friday implied a roughly 67% probability that the Fed would leave its benchmark rate unchanged, compared with a 33% chance of a quarter-point increase. Just two weeks earlier, markets had assigned a 67% probability to a September rate hike.