AE Wealth Management: Weekly Market Insights | 6/14/26-6/20/26
Weekly Market Commentary
THE WEEK IN REVIEW: June 14-20, 2026
Not quite “unconditional”
After all the hoopla, bombing and rhetoric, President Donald Trump signed a memorandum of understanding with Iran.1 What exactly did we get out of it? The Strait of Hormuz opened again, but it was open before this all started at the end of February, even after the U.S. and Israel bombed Iran’s nuclear facilities last year. It seems that wasn’t permanent enough, so the conflict flared up once more in an attempt to secure Iran’s nuclear materials and force them to give up their nuclear ambitions. The blockade seemed to be having a solid effect, but despite Iran having no navy or air force to harass shipping, it appears no one was willing to sail through the strait and take a chance something bad might happen.
The president signed the memorandum in Versailles, France, which immediately opened the strait and lifted the blockade to allow Iran to sell oil. That sounds pretty conciliatory — but what did we get? We’ve seen the promise of talks for 60 days on the things we really wanted but haven’t gotten yet: the nuclear materials, the renunciation and dismantling of their nuclear program and the cessation of support for terrorist proxies like Hezbollah. So far, nothing concrete has come out of it — and Iran has since declared the strait closed again, though shipping has only stalled rather than halted entirely.2
In related news, oil prices are declining quickly, which the markets liked.3 Oil closed around $75 per barrel last week, only $7-$8 higher than when the hostilities started at the end of February. We broke 52,000 on the Dow Jones Industrial Average, while the S&P 500 and Nasdaq are closing in on new highs as well.4,5,6 We don’t see the memorandum as the end of anything, but just a pause in this cat-and-mouse game. Meanwhile, markets have already moved on.
Warsh’s debut as Fed chair doesn’t inspire markets
The Federal Reserve concluded its first meeting with Kevin Warsh as the new chair. The June meeting ended with the Fed holding the policy rate steady at 3.50-3.75%, an outcome that was never really in doubt.7
The more interesting signals came from the Summary of Economic Projections (SEP), the policy statement and Warsh’s first press conference, which may prove to be his most substantial.8,9,10 The statement was simplified and stripped of forward guidance, while the SEP showed a committee roughly split between holding rates steady for the remainder of the year and possibly hiking at least once, a hawkish shift versus the previous projections in March.
The markets took notice and reacted negatively with a large-scale sell-off on Wednesday before recovering on Thursday. Gone are the two cuts widely expected by the market earlier this year, and the hope now is that rates don’t go up but rather stay the same. That will all depend on whether or not the rise in inflation begins to wane now that oil prices have plummeted.
Some analysts said the second half of 2026 was going to be a new “golden age” for the U.S. economy. We’re not seeing it so far; oil prices have indeed tumbled, but how soon and how much that will translate into lower inflation is up in the air. There is a possibility that the memorandum of understanding with Iran will fall through, and we will have conflict once again, which will undoubtedly impact oil prices and drive inflation upward again.
Kevin Warsh is in an unenviable position. Does he appease a president who wants lower rates to help an economy that isn’t growing? Or does Warsh do the right thing by raising rates to stomp down inflation, potentially driving us into a recession? Sometimes the best deal is the one you don’t make, and the best decision isn’t to take on an impossible job — something Warsh should have thought about.
Coming this week
- We’re back to a full week of trading after the long holiday weekend. There really won’t be any significant data until Wednesday, when we’ll see MBA mortgage applications and the release of the Fed’s annual bank stress test results.
- On Thursday, we’ll get personal consumption expenditures (PCE), the Fed’s preferred measure of inflation. Thursday will also feature weekly jobless claims, personal income and consumer spending. We’ll also get the third and final reading of first-quarter gross domestic product (GDP), which is projected to remain at an anemic 1.6% rate.11
- We’ll close out the week with wholesale inventories and the University of Michigan consumer confidence survey, which is expected to improve somewhat due to lower gas prices.
Index Performance Returns % | |||||
| 1 WK | YTD | 1YR | 3YRS | 5YRS | |
| S&P 500® | 1.44% | 9.57% | 25.41% | 19.37% | 12.48% |
| NASDAQ | 2.47% | 14.09% | 35.67% | 24.66% | 13.58% |
| DJIA | 1.41% | 7.29% | 22.27% | 14.56% | 9.15% |
Interest Rates: | |||||
| 6/19/2026 | 6/12/2026 | ||||
| UST 10 YR Government Bond Yield | 4.50% | 4.83% | |||
| Germany 10 YR | 2.99% | 3.00% | |||
| Japan 10 YR | 2.68% | 2.62% | |||
| 30 YR Mortgage | 6.48% | 6.57% | |||
| Oil | $77.49/ppb | $84.88/ppb | |||
| Regular Gas | $3.94/ppg | $4.07/ppg | |||
| All data as of June 19, 2026. | |||||
Sources:
1 Arab Center Washington DC. June 17, 2026. “The Full Text of the Memorandum of Understanding between the United States and Iran.” https://arabcenterdc.org/resource/memorandum-of-understanding-between-the-united-states-of-america-and-the-islamic-republic-of-iran/. Accessed June 21, 2026.
2 John Power. Aljazeera. June 22, 2026. “Shipping stalls in Strait of Hormuz after Iran declares key waterway shut.” https://www.aljazeera.com/economy/2026/6/22/shipping-stalls-in-strait-of-hormuz-after-iran-declares-key-waterway-shut. Accessed June 22, 2026.
3 Business Insider. “Oil (WTI).” https://markets.businessinsider.com/commodities/oil-price?type=wti. Accessed June 21, 2026.
4 Yahoo! Finance. “Dow Jones Industrial Average (ˆDJI).” https://finance.yahoo.com/quote/%5EDJI/. Accessed June 21, 2026.
5 Yahoo! Finance. “S&P 500 (ˆGSPC).” https://finance.yahoo.com/quote/%5EGSPC/. Accessed June 21, 2026.
6 Yahoo! Finance. “NASDAQ Composite (ˆIXIC).” https://finance.yahoo.com/quote/%5EIXIC/. Accessed June 21, 2026.
7 Scott Horsley. NPR. June 18, 2026. “Fed holds interest rates steady and hints at future rate hike.” https://www.npr.org/2026/06/18/nx-s1-5862068/fed-holds-interest-rates-steady-and-hints-at-future-rate-hike. Accessed June 21, 2026.
8 Federal Reserve. June 17, 2026. “Summary of Economic Projections.” https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20260617.pdf. Accessed June 21, 2026.
9 Federal Reserve. June 17, 2026. “Federal Reserve issues FOMC statement.” https://www.federalreserve.gov/newsevents/pressreleases/monetary20260617a.htm. Accessed June 21, 2026.
10 Federal Reserve. June 17, 2026. “Transcript of Chairman Warsh’s Press Conference Opening Statement.” https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20260617.pdf. Accessed June 21, 2026.
11 MarketWatch. “This Week’s Major U.S. Economic Reports & Fed Speakers.” https://www.marketwatch.com/economy-politics/calendar. Accessed June 21, 2026.
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