June 8, 2026

“Time is your friend; impulse is your enemy”

John Bogle

What goes up must come down, as the old saying goes, last week was no exception. Here are the numbers, The S&P 500 lost 2.6%, the Dow Jones Industrial Average surrendered a slight .30%, and the Nasdaq was hit hard off 4.7%. Internationally, the FTSE-!00 fell .30% and the MSCI-EAFE gave up 2.4%. The 2- Year Treasury yield was 4.147 % and the 10-Year paid 4.532%.

So why the bad news? The sell-off was driven by tech weakness (e.g., chipmakers like Broadcom, Nvidia peers), with the S&P 500 and Nasdaq experiencing significant intraday volatility. The good news? Year to Date performance remained positive overall. Though it was a classic corrective week after strong prior gains, with rotation away from mega-cap tech. The Dow was the most resilient of the major U.S. indexes, supported by defensive sectors. Consumer sentiment also played a part, due to broader economic resilience (jobs data) mixed with higher yield/rate concerns were the culprits. So, all the major U.S. stock indexes finished the week lower, with tech-heavy sectors leading the declines. This snapped a strong winning streak for the S&P 500 (its first losing week in about 10) amid a sharp sell-off driven by stronger-than-expected May jobs data, which fueled concerns over persistent inflation, higher-for-longer interest rates, and rising Treasury yields.

International Indices pitch in the declines, however the FTSE 100 showed relative resilience, supported by defensive stocks amid limited tech exposure. European markets overall lacked strong direction. Broader European indices declined modestly, with mixed results across countries (e.g., Germany’s DAX weaker, France’s CAC 40 slightly positive).

On to the economy, the economic results announced last week, the standout release was the May U.S. Jobs Report (nonfarm payrolls) last Friday. Employers added 172,000 jobs, roughly double economist expectations (85,000) and following an upwardly revised prior month. Unemployment rate held steady at 4.3% This resilient labor market data raised concerns about sticky inflation and potential delays in Federal Reserve rate cuts, contributing to higher yields and the equity sell-off. The strong job report shifted sentiment toward “higher for longer” rates.

Inflation? Most other data released last week reinforced focus on inflation and growth resilience. CPI rose 0.6% month-over-month and 3.8% year-over-year (highest since May 2023. Core CPI (ex-food/energy) rose 0.4% m/m and 2.8% y/y. Markets are now eyeing the upcoming May CPI (June 10), Fed signals, and geopolitical developments.

Speaking of which, the ongoing developments in the Middle East (U.S.-Iran tensions, Israel-Lebanon dynamics) created volatility but showed some signs of potential negotiations or ceasefire extensions. Markets appeared to digest these with limited direction at times, though oil prices and yields reacted to headlines. Tariff announcements (e.g., potential new U.S. tariffs of 10-12.5% on various countries) added another layer of uncertainty. Overall, geopolitics contributed to benign sentiment but did not dominate as much as domestic economic data.

In the bond market, Treasury yields rose during the week on the strong jobs data, with the 10-year yield moving higher (around 4.4-4.5% range in recent sessions). This pressured bonds and equities.

Finally, what’s going on with interest rates and the housing market? Still status quo is the answer with mortgage rates not moving much. The 30-year fixed-rate mortgage averaged around 6.48-6.52% in early June looking at a variety of lenders. Rates remained elevated amid yield movements and inflation concerns, though relatively stable week-to-week. The 15-year fixed was in the mid-5% range. No surprise the housing market continued to face affordability challenges due to higher rates. Data reflected a resilient but pressured sector, with mortgage rates tied closely to Treasury yields and broader economic signals.

Overall, Year To Date performance for major U.S. indexes stayed solidly positive. Markets are now eyeing the upcoming May CPI (June 10), Fed signals, and geopolitical developments. As 2026 progress the numbers still point to positive returns, how much will have a lot to do with the geo-political events, economic policies playing out and most importantly to inflation, the direction of oil prices. If the administration “patience but holding the hammer overhead approach” succeeds good things are ahead.

Mike