AE Wealth Management: Weekly Market Insights | 5/31/26-6/6/26
Weekly Market Commentary
THE WEEK IN REVIEW: May 31-June 6, 2026
The never-ending story
It seems like we keep talking about the same thing over and over: the war in Iran. Sadly, this week has offered few solutions to the conflict.
What was supposed to be four weeks is now going into four months, kind of like a bathroom remodel that just won’t end. It all started back on Feb. 28, and the bombing stopped after about a month. For two months now, we’ve been hearing that a “deal is imminent.” But another week has passed by with the same “close to a deal” rhetoric, but so far nothing’s been made public.
Some new items get floated every now and then, but it’s mostly just fodder for speculation.1 As we said last week, markets have largely moved on from the current situation in Iran. Earnings were good and we’re coping with higher gas prices. The consumer is grumpy but continues to spend. Markets did get jittery last week with the potential for higher rates on the horizon (see next section).
We shouldn’t expect to get daily updates from the president, the State Department and the Pentagon on developments with Iran, but it also doesn’t seem we have a viable strategy to finish this. We threaten to start bombing again and get “a deal is coming any day now” in response, so we stand down. The best thing for the markets and the American people is to get this resolved once and for all.
Jobs data remains solid
Jobs and earnings have really been the only standouts during the Iran conflict. Last week’s Bureau of Labor Statistics (BLS) jobs report for May was good — maybe too good.2 Expectations were for 85,000 new jobs to be created in May; the actual number was an increase of 172,000, more than double expectations. The April number was also revised upward by an additional 64,000, going from 115,000 to 179,000 new jobs. Unemployment was unchanged at 4.3%.
The ADP employment report was more in line with estimates earlier in the week — coming in at 122,000 versus the estimate of 120,000 — but robust just the same.3 Meanwhile, the Job Openings and Labor Turnover Survey (JOLTS) on Tuesday showed openings jump from a revised 6.89 million in March to 7.62 million in April.4 (The JOLTS report lags by a month.)
Strong job growth would normally be a good sign and positive for the economy, right? Not so fast. Markets had a nasty sell-off on Friday after some rotation from high-flying tech stocks earlier in the week. Once again, markets played normally good news into bad.
What happened? Remember the Federal Reserve has two mandates: price stability (i.e., keeping inflation in check) and pursuing full employment. The Fed is being faced with a choice; given the strength of the recent jobs figures versus the continued inflationary prices due to the conflict in Iran and rising global oil prices, it appears abundantly clear that interest rates shouldn’t be lowered but that raising rates may be in order.
The 10-year Treasury agreed with that assessment last Friday, and the yield jumped to over 4.5% again.5 That got markets worried late last week, and it makes sense investors would get skittish, especially since we’ve been hovering at or near records.
The drop started with a rotation out of the narrow set of high-flying chip and tech stocks into more defensive areas like banks and industrials.6 Then, sensing potentially higher rates would negatively impact future earnings, the entire market took it on the chin on Friday.
The decision to step back was made easier by the fact that we’ve been hovering around all-time highs. The downside is large if something were to go more sideways in the Gulf or if the Fed signals higher rates ahead. But missing out on a little more of the upside isn’t as painful — at least that was the thinking last week.
Coming this week
- No data is scheduled for Monday.
- Tuesday will be pretty mundane, with the U.S. trade balance, existing home sales and wholesale inventories.
- The action will pick up Wednesday with fresh readings of the May Consumer Price Index (CPI). Expectations are for inflation to keep rising. We’ll also see MBA mortgage applications.
- We’ll see the latest Producer Price Index (PPI) on Thursday. It seems likely PPI will climb more, especially with oil still hovering around $90 per barrel.7
- Consumer sentiment, which has been in the tank for some time thanks to inflation and high gas prices, will provide a muted end to the week.
Index Performance Returns % | |||||
| 1 WK | YTD | 1YR | 3YRS | 5YRS | |
| S&P 500® | -2.59% | 7.86% | 24.32% | 19.99% | 11.79% |
| NASDAQ | -4.68% | 10.62% | 33.22% | 24.79% | 13.23% |
| DJIA | -0.23% | 5.83% | 20.20% | 14.87% | 7.91% |
Interest Rates: | |||||
| 6/5/2026 | 5/29/2026 | ||||
| UST 10 YR Government Bond Yield | 4.53% | 4.47% | |||
| Germany 10 YR | 3.03% | 2.95% | |||
| Japan 10 YR | 2.66% | 2.68% | |||
| 30 YR Mortgage | 6.52% | 6.56% | |||
| Oil | $90.54/ppb | $89.39/ppb | |||
| Regular Gas | $4.19/ppg | $4.34/ppg | |||
| All data as of June 5, 2026. | |||||
Sources:
1 Alayna Treene and Kevin Liptak. CNN. June 3, 2026. “Monetary compensation becomes key sticking point in Iran deal as Trump bristles at comparison to Obama agreement.” https://www.cnn.com/2026/06/03/politics/monetary-compensation-iran-deal. Accessed June 6, 2026.
2 Bureau of Labor Statistics. June 5, 2026. “The Employment Situation — May 2026.” https://www.bls.gov/news.release/pdf/empsit.pdf. Accessed June 6, 2026.
3 ADP Research. May 2026. “ADP® National Employment Report.” https://adpemploymentreport.com/. Accessed June 6, 2026.
4 U.S. Bureau of Labor Statistics. “Job Openings and Labor Turnover Survey.” https://www.bls.gov/jlt/. Accessed June 6, 2026.
5 CNBC. “U.S. 10 Year Treasury.” https://www.cnbc.com/quotes/US.10. Accessed June 6, 2026.
6 Stephen Culp and Medha Singh. Yahoo! Finance. June 5, 2026. “Wall Street ends sharply lower as chips slide, jobs data fuels rate hike fears.” https://finance.yahoo.com/markets/stocks/articles/nasdaq-p-futures-decline-semiconductors-110740283.html. Accessed June 6, 2026.
7 Business Insider. “Oil (WTI).” https://markets.businessinsider.com/commodities/oil-price?type=wti. Accessed June 6, 2026.
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