Investment Week at a Glance
Stocks finished higher for the week. The Dow Jones Industrial Average rose 0.4%, the S&P 500 was up 2.4%, and the NASDAQ rose 4.5%. Foreign stocks (MSCI EAFE) were also up for the week, rising 2.5%. Bond prices were down for the week, with the 10-year U.S. Treasury ending the week at 4.39%. (Data source: Wall Street Journal)
Improving Labor Market
Labor market data is always closely followed by investors as it could be a sign of where the economy is headed. Coming into this year, there were some worries as the data wasn’t terrible, but it was showing some signs of slowing, with just an increase of 25,000 jobs per month. This year, we have now seen an average of 90,000 jobs per year added in private employment, and unemployment is currently 4.3%, still historically low. This has helped take some uncertainty away, which is typically a positive for markets. This can always change, but currently, the labor market is in good shape, and wages continue to outpace inflation.
Fed Outlook
Coming into this year, the market was pricing in 2 rate cuts for 2026. That all changed after the spike in energy prices due to the Iran war. The market is now pricing in no rate cuts for 2026 and actually is pricing in the chance of a rate hike, more so than a cut. The same is true for current 2027 expectations that we won’t see a cut next year either, a big difference from what was priced in at the beginning of this year. We will see if this changes if oil prices begin to come back down to the levels we saw to start the year. This shows that even in today’s world with unlimited data, one event can change expectations for years to come.
Alphabet Stock Up Over 26% Year to Date, and Over 150% In the Last Year
Alphabet (GOOG), the parent company of Google, has performed remarkably over the last year, with its stock price increasing by over 150%. Alphabet has benefited significantly since the release of its AI tool Gemini, and the September 2025 Federal Court ruling that allowed Google to keep Chrome, avoiding an anticipated forced breakup. On February 6th, Alphabet’s annual report showed that the company’s earnings grew by over 30% in 2025. Alphabet followed this up with another strong performance, releasing its Q1 financials for 2026. The company showed an 81% increase in earnings over the same period in 2025. The company’s strong financials have fueled investor confidence and increased Alphabet’s market cap to nearly $5 trillion. (CNBC)
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Quiz
How much has the market (S&P 500) increased since its close on March 30? (Scroll Down for Answer)
- 9%
- 12%
- 16%
- 19%
Answer:
3. 16%. The S&P 500 closed at $6,343.72 on March 30th, the index’s lowest close of the calendar year. Since then, in a little over a month, the index has increased by over 16%, with the close on May 8th of $7,398.93. This shows the importance of investors maintaining a long-term mindset when investing during periods of volatility.
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