Stock markets pulled back last week after a remarkable nine-week winning streak. A stronger-than-expected jobs report, escalating Middle East tensions, and Broadcom’s forward revenue forecast put the brakes on the rally.
📊 Market Index Performance: Last Week and Year-to-Date
| Index | Last Week | YTD |
|---|---|---|
| Dow Jones Industrial Average | (0.30%) | +5.86% |
| S&P 500 | (2.72%) | +7.72% |
| NASDAQ Composite | (4.49%) | +10.84% |
| Russell 2000 | (3.38%) | +13.65% |
| Foreign Stocks | (2.68%) | +6.21% |
| Emerging Markets | (6.05%) | +17.80% |
| Bloomberg U.S. Aggregate Bond Index | (0.11%) | +0.26% |
| Bloomberg Municipal Bond Index | (0.12%) | +0.55% |
The 10-Year U.S. Treasury ended the week yielding 4.532%.
Strong Jobs Report Creates Market Concerns
The United States created 172,000 jobs in May, led by gains in:
- Healthcare
- Leisure & Hospitality
Job losses were concentrated in:
- Residential Construciton
- Financial Services
- Retail Trade
Consensus expectations were for an increase of only 80,000 jobs, making the report significantly stronger than expected.
So why would a better-than-expected jobs report be viewed negatively by investors?
The stronger the economy remains, the less likely the Federal Reserve is to reduce interest rates. In fact, some investors are now beginning to price in the possibility that the Fed could eventually raise rates again if inflation remains stubbornly high.
Even with sticky inflation throughout 2026, longer-term yields such as the U.S. 30-Year Treasury remain range-bound. At this point, I continue to believe the Federal Reserve will remain on hold for the foreseeable future.
Broadcom Delivers, But Expectations Remain High
Last week, Broadcom hit the ball out of the park with its earnings results. However, the company’s forward-looking revenue guidance fell short of Wall Street’s lofty expectations.
In today’s market environment, strong earnings alone are often not enough. Investors want exceptional results, and even stronger forecasts.
That combination helped contribute to the sharp pullback seen in technology stocks late in the week.
Iran, Oil Prices, and Market Volatility
Over the pond, it does not appear we are making any meaningful progress with Iran and the Strait of Hormuz.
Combining a robust jobs report, Broadcom’s outlook, and rising oil prices was all the market needed to pull back sharply on Friday.
The NASDAQ’s one-day decline of 4.18% was its largest single-day drop in quite some time.
The longer tensions persist in the Middle East, the greater the risk that higher energy prices could place additional pressure on inflation and economic growth.
Inflation Reports Take Center Stage This Week
This week features two important economic report releases:
Wednesday – Consumer Price Index (CPI)
Thursday – Producer Price Index (PPI)
Current expectations are:
| Category | Consumer Price Index (CPI) | Producer Price Index (PPI) |
|---|---|---|
| Headline Inflation: | 0.5% | 0.7% |
| Core Inflation: | 0.3% | 0.5% |
If inflation comes in at or above these levels, more investors may begin to believe inflation is gaining a stronger foothold in the economy.
That would likely increase pressure on both stocks and bonds.
SpaceX IPO Expected This Week
In addition to inflation data, investors are eagerly awaiting the much-anticipated and heavily hyped SpaceX Initial Public Offering (IPO) expected on Friday, June 12, 2026.
The expected valuation is approximately $1.77 trillion.
WOW!!
This could become one of the largest and most closely watched IPOs in market history.
Final Thoughts
As we enter the summer months, I expect volatility to increase as more questions and doubts begin to surface.
The longer the U.S.-Iran conflict continues, the greater the odds of unintended economic consequences.
On the positive side:
- Unemployment remains low at 4.3%
- Affluent consumers continue to spend money
- Investment in Artificial Intelligence shows no signs of slowing
If volatility picks up, it is important to keep your head squarely on your shoulders.
Each time the market pulls back, investors begin to believe, “This is the end.”
History has shown that most of the time, it is not.
Stay diversified, know where your retirement income will come from, remain disciplined, relax, and enjoy the summer season.
Thank you for reading!
Paul Levin, CFP®, ChFC®, RICP®, TPCP®
Managing Principal | Retirement Refined, LLC
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
All market data sourced from The Wall Street Journal, June 5, 2026.
