Each month, our team publishes a comprehensive market dashboard covering the economic trends, global market performance, and geopolitical developments most relevant to your portfolio.

The dashboard is designed to give you a clear, readable summary of what happened in markets, why it matters, and what we're watching going forward.

For those who want to go deeper, each monthly issue is accompanied by a full Outlook & Positioning report with detailed charts, sector-level analysis, and our current portfolio positioning. Complete the brief form on any issue below to access the full report instantly.

July Monthly Dashboard

Each month's dashboard comes with a detailed research report covering charts, sector analysis, and portfolio positioning not included here. Request access to the full report

Dials June

Executive Summary:

Equity markets stalled somewhat in June but still produced positive returns through the second quarter and first half of 2026.
While the conflict is not fully resolved, its cooling led oil prices to fall back to near pre-conflict levels, potentially providing some respite for consumers struggling with higher prices. SpaceX went public last month as the first of the highly anticipated mega-cap IPOs, potentially setting the stage for OpenAI and Anthropic to test markets in the second half of the year.
The Federal Reserve met in June with Chair Kevin Warsh at the helm for the first time, and while they kept interest rates unchanged, Warsh struck a hawkish tone suggesting inflation is still running too high for comfort

Equity Markets Up YTD, But Stall in June

The astronomical rise of a handful of technology stocks, many of them related to memory and storage for artificial intelligence (AI), has helped to lift both US and emerging markets indexes so far in 2026. Companies such as Micron, Advanced Micro Devices, Dell, Sandisk, and IBM, as well as South Korean companies SK Hynix and Samsung, appear to have taken over the leadership role from the “Magnificent 7” this spring.[1]

However, the rally lost steam in June as questions about inflation, market leverage, and the sustainability of the AI trade soured sentiment somewhat.[2] Despite the S&P 500 and the more technology-heavy Nasdaq index falling slightly for the month, the two indexes ended June with their best quarterly return in six years.[3] Emerging markets and small-cap stocks (as represented by the MSCI Emerging Markets and Russell 2000 indexes, respectively) fared even better in the first half of 2026, with each advancing more than 20% as the two continue to lead equity asset classes (see below).

positive, but volatile start to 2026 chart

Markets Remain Optimistic on Conflict Resolution

Negotiations toward a durable peace agreement with Iran remain ongoing under the 60-day framework established by the memorandum of understanding. Although violence has continued intermittently, markets remain optimistic that the conflict will be resolved. That optimism was supported by a tentative ceasefire agreement announced on June 28 that is intended to pause hostilities and allow peace talks to resume.[4]

Despite the difficulties in negotiations, energy markets appear confident that an agreement will be reached in the near future as prices have fallen back toward pre-conflict levels. Oil prices are now just above where they were when the conflict broke out, while gas, diesel, and jet fuel all remain at least 20% higher (see charts below).[5] If traffic through the Strait of Hormuz begins to normalize soon, we anticipate inflation beginning to recede from its current level (inflation currently sits at 4.2% year-over-year, more than double the Federal Reserve’s 2% target).[6] However, if the closure persists, we expect inflation to remain higher for longer, putting additional strain on consumers (and pressure on the Fed to raise interest rates to dampen inflation).

. retail gasoline s diseal prices chart

Changing of the Guard at the Fed

Last month also marked the first Federal Reserve (Fed) meeting with Kevin Warsh as Chair, as he took over leadership after Jerome Powell’s tenure came to a close (although Powell remains a voting member). As promised, Warsh provided less from a communication and forward guidance perspective (the official Fed statement was approximately 130 words, down from about 340 words in Powell’s final statement in April), instead committing to the creation of five task forces to review the role of monetary policy at the Fed.[7] Recommendations from the task forces are expected by year-end, but we expect some reduction in the size of the Fed’s balance sheet given Warsh’s previous comments.[8]

The Fed unanimously voted to hold rates steady in June, marking the first unanimous vote since June of 2025. However, for those anticipating Warsh to be more dovish on inflation, he quickly dispelled those expectations. He called out the current energy shock created by the Iran conflict as a reason for concern and ended his statement abruptly with the pledge, “The Committee will deliver price stability.”[9] Markets reacted as expected to the hawkish tone of the meeting, as equity market retreated somewhat immediately afterward.[10]

The 10-year Treasury yield closed June at approximately 4.45%, below its peak in May but still higher than where it stood at the beginning of the year. The 2-year Treasury yield ended the month slightly higher at 4.15%. That marks a significant jump from the beginning of the year before the Iran conflict broke out when markets were pricing in interest rate cuts rather than rate hikes for 2026.[11]

Bonds, as represented by the Bloomberg US Aggregate index, are modestly positive year-to-date. Broad-based commodities (Bloomberg Commodities index) rallied through the first part of the year as energy prices climbed during the Iran conflict but have fallen as the worst of the violence appears to have subsided. Gold (S&P GSCI Gold index) also rose in the spring but has fallen since as the metal continues to search for a market narrative.

bond and commodity priced ytd chart

Market Concentration & Leverage Create Volatility Concerns

As we have discussed in previous Dashboards, market concentration in the largest US corporations has been growing over the past few years as several AI-related technology companies continue to lead the domestic markets higher. Leadership has shifted somewhat this year away from the Magnificent 7 toward the semiconductor and memory companies mentioned previously (see below left).[12] However, the top 10 companies in the S&P 500 index now represent approximately 40% of the index’s market cap and 35% of 12-month forward earnings (see below right).[13]

chipmakers buck the magnificent seven sell-off chart

This market concentration phenomenon has also spread to emerging markets as Samsung Group and SK Hynix have joined Taiwan Semiconductor Manufacturing as the largest holdings in the MSCI Emerging Markets index (the three currently represent about 31% of the iShares MSCI EM ETF, ticker EEM, as of June 30).[14]

Samsung Group and SK Hynix have rallied significantly this year as the two companies announced plans to expand production capacity by spending over $800 billion to build additional semiconductor plants in South Korea. President Lee Jae Myung went so far as to refer to the companies as “national heroes,” as the country seeks to double its memory production capacity in the next five years.[15]

It is important to note that market concentration is not new; it is something we have been tracking and writing about for years. However, the rising level of leverage that accompanies this market concentration is a recent development. For example, assets in leveraged US ETFs (see bottom left) and margin loans outstanding in South Korea markets (bottom right) are both growing alongside increased market concentration in those two markets.[16] [17]

total assets in leveraged etfs

Our concern is that these two phenomena – rising market concentration and increased leverage – occurring in tandem have the potential to markedly amplify market volatility. We are seeing some of that in the broad market, but it is more pronounced in single-stock implied volatility. As illustrated below, single-stock implied volatility premium for the S&P 500 index is now well above any level we’ve seen going back to 2014.[18]

single stock implied volatility premium chart

The Path Forward

The first half of 2026 ended with relatively strong returns given that the Iran conflict effectively closed the Strait of Hormuz for several months, through which approximately 20% of global energy flows. Many of the major equity markets advanced 10% or more despite the volatility, and small-cap US and emerging markets stocks performed even better.

Additionally, June witnessed the initial public offering of SpaceX. By most accounts, the IPO was a success as the stock ended June about 26% above its IPO price.[19] The launch potentially sets the stage for other highly anticipated IPOs, such as OpenAI and Anthropic, in late 2026 or early 2027.

The US economy also proved resilient in the first half of the year. Despite concerns that AI would threaten jobs, unemployment remains at just 4.2%. Economic growth remains positive, as year-over-year gross domestic product sits at a respectable 2.7% based upon the most recent reading.[20]

However, the AI story remains a major influence on the US economy as well, underpinning growth through difficult stretches. For example, the quarterly contribution to economic growth related to the data center buildout exceeded the contribution of all personal consumption expenditures in the first quarter of 2026 (see below).[21]

quarterly contributions to real gdp growth chart

In some ways, AI has been a blessing over the past few years for both markets and the economy. However, as market concentration and leverage continue to build, we feel as though both the market and economy increasingly hinge on one assumption – that advancements in AI will increase productivity and wealth without displacing workers. This outcome is entirely possible, and we hope it proves true, but we caution investors against concentrating their wealth in a single thesis, however compelling.

As always, we appreciate your continued trust and welcome the opportunity to speak with you in greater detail regarding your specific situation.

Sources & References

[1] Source: YCharts, June 30, 2026, and Financial Times, “Magnificent Seven stocks shed $2.3tn in Wall Street tech rotation,” June 30, 2026. https://www.ft.com/content/b90bdfcb-d773-42f7-bb5f-52dbd28b2174?syn-25a6b1a6=1

[2] Source: Financial Times, “S&P 500 notches longest losing streak in 10 months as chipmakers slide,” June 26, 2026. https://www.ft.com/content/bb70e272-5b09-4806-8b19-7c03c350f580?syn-25a6b1a6=1

[3] Source: YCharts/MT Newswires, “Update: Dow Hits Fresh High as Wall Street Posts Solid Quarterly Gains,” June 30, 2026. https://www.marketscreener.com/news/dow-hits-fresh-high-as-wall-street-posts-solid-quarterly-gains-ce7f5fddd88ef62d

[4] Source: Wall Street Journal, “U.S. and Iran Agree to Halt Days of Fighting Over Strait,” June 29, 2026. https://www.wsj.com/world/middle-east/iran-asserts-sole-control-of-hormuz-warns-challenges-will-bring-more-violence-5abea3c7?mod=hp_lead_pos1

[5] Source: JP Morgan, “Eye on the Market,” June 2026. https://am.jpmorgan.com/content/dam/jpm-am-aem/global/en/insights/eye-on-the-market/trump-tracker-amv.pdf

[6] Source: YCharts, June 30, 2026

[7] Source: FHN Financial, “Economic Weekly,” June 26, 2026. https://docs.fhnfinancial.com/?ab2bd8d9-efb3-48a4-975c-78377fa01e12

[8] Source: Federal Reserve, “Transcript of Chairman Warsh’s Press Conference,” June 17, 2026. https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20260617.pdf

[9] Source: FHN Financial, “Economic Weekly,” June 18, 2026. https://docs.fhnfinancial.com/?33c2c960-8d46-4907-857b-ea4251c70033

[10] Source: YCharts, June 30, 2026.

[11] Source for all yield data: YCharts, June 30, 2026.

[12] Source: Financial Times, “Magnificent Seven stocks shed $2.3tn in Wall Street tech rotation,” June 30, 2026. https://www.ft.com/content/b90bdfcb-d773-42f7-bb5f-52dbd28b2174?syn-25a6b1a6=1

[13] Source: JP Morgan, “Eye on the Market - Semiquincententacles,” June 2026. https://am.jpmorgan.com/content/dam/jpm-am-aem/global/en/insights/eye-on-the-market/semiquincententacles-amv.pdf?email_campaign=314411&email_job=658351&email_contact=003j0000018XrBPAA0&utm_source=clients&utm_medium=email&utm_campaign=ima-eotm-inst-06232026&memid=7220927&email_id=100167&decryptFlag=No&e=ZZ&t=603&f=&utm_content=read-eotm

[14] Source: YCharts, June 30, 2026.

[15] Source: Bloomberg, “Samsung, SL to Spend $880 Billion to Drive Korea’s AI Lead,” June 28, 2026. https://www.bloomberg.com/news/articles/2026-06-28/samsung-sk-reportedly-to-invest-1-3-trillion-over-10-years?cmpid=062926_marketsdaily&utm_campaign=marketsdaily&utm_medium=email&utm_source=newsletter&utm_term=260629&utm_content=6021

[16] Source: Source: JP Morgan, “Eye on the Market - Semiquincententacles,” June 2026. https://am.jpmorgan.com/content/dam/jpm-am-aem/global/en/insights/eye-on-the-market/semiquincententacles-amv.pdf?email_campaign=314411&email_job=658351&email_contact=003j0000018XrBPAA0&utm_source=clients&utm_medium=email&utm_campaign=ima-eotm-inst-06232026&memid=7220927&email_id=100167&decryptFlag=No&e=ZZ&t=603&f=&utm_content=read-eotm

[17] Source: Wall Street Journal, “The Trillion Dollar Borrowing Binge Lifting the Stock Market to Risky Heights,” June 28,2026. https://www.wsj.com/finance/stocks/the-trillion-dollar-borrowing-binge-lifting-the-stock-market-to-risky-heights-8d0377f9?mod=hp_lead_pos2
[18] Source: Apollo, “Daily Spark – Tech Dominance Is Pushing Single Stock Risk to Records,” June, 10, 2026. https://www.apollo.com/wealth/insights-news/insights/daily-spark/tech-dominance-is-pushing-single-stock-risk-to-records?utm_medium=email&utm_source=pardot&utm_id=1feca30be61a1077771319ee7e2f5367&utm_campaign=EXT_Daily+Spark&utm_content=body-image-dailyspark-chart1

[19] Source: YCharts, June 30, 2026.

[20] Source: YCharts, June 30, 2026.

[21] Source: JP Morgan, “Eye on the Market - Semiquincententacles,” June 2026. https://am.jpmorgan.com/content/dam/jpm-am-aem/global/en/insights/eye-on-the-market/semiquincententacles-amv.pdf?email_campaign=314411&email_job=658351&email_contact=003j0000018XrBPAA0&utm_source=clients&utm_medium=email&utm_campaign=ima-eotm-inst-06232026&memid=7220927&email_id=100167&decryptFlag=No&e=ZZ&t=603&f=&utm_content=read-eotm

June Monthly Dashboard

Each month's dashboard comes with a detailed research report covering charts, sector analysis, and portfolio positioning not included here. Request access to the full report

Dials June

Executive Summary:

Equity markets continued to climb throughout May, with many indexes closing near all-time highs despite the absence of a resolution in the US-Iran conflict.
Strong corporate earnings, positive artificial intelligence (AI) momentum, renewed interest in quantum computing, and excitement over the potential upcoming initial public offerings (IPOs) are helping to drive optimism.
Technology stocks continue to lead markets higher; however, leadership has broadened out beyond the Magnificent 7 to other companies.
The upcoming IPO of SpaceX, which appears to be on track to be the largest IPO in history, has generated significant interest among retail and institutional investors alike and appears to be causing index providers to revisit their methodology in an effort to participate

The rise in equity markets occurred despite what remains a somewhat challenging geopolitical environment. Investors appear to be looking past the conflict in Iran, hoping an agreement to end the conflict and open the Strait of Hormuz is reached soon. As the month drew to a close, President Trump stated he intends to meet with his advisors to consider the peace deal.

Optimism that a deal will be reached soon was also evident in energy markets. After topping out near $115 per barrel earlier in the year, Brent crude oil futures fell 19% during May, ending the month at about $92 per barrel. Similarly, West Texas crude fell 17% for the month.[i]

Aside from stocks, other asset classes produced mixed results in May. The Bloomberg Commodity Index gave back some of its year-to-date gains, falling approximately 3.6%, as energy prices receded and gold fell slightly for the month (see S&P GSCI Gold index above).

The 10-year Treasury yield closed May at approximately 4.45%, finishing near its post-cease-fire high, while the 2-year Treasury yield ended the month slightly higher, as well, at 3.98%. Bond markets continue to contend with higher inflation (more on that below), a new Federal Reserve Chair, and the growth of our national debt (US public debt recently exceeded GDP for the first time since 1946).[i] Bonds were essentially flat for the month as investors considered all of these factors, as the Bloomberg US Aggregate Bond index was up 0.3% (as indicated in the first chart above).[ii]

Economic Data Remains Mixed

Compared to the market, which has been quite bullish over the past two months, US economic data remains much more nuanced. Economic growth remains positive, with quarter-over-quarter gross domestic product (GDP) increasing modestly at 1.6%. GDPNow, a model published by the Federal Reserve Bank of Atlanta, provided a more bullish real-time estimate of quarterly GDP of 3.0% as May ended (driven in part by AI infrastructure spending, discussed last month).[iii][iv] When viewed alongside official unemployment figures (a relatively low 4.3% as of May 31), the economic situation appears quite solid.

However, elevated inflation, along with growing national and household debt levels, muddy the picture somewhat. The Consumer Price Index (CPI) currently sits at 3.8% year-over-year, well above the Federal Reserve (Fed) target of 2%.[v] In addition, price increases related to the Iran conflict may not be completely captured by inflation data yet, meaning it is possible that inflation keeps climbing for several months even if a peace agreement is reached soon, making it difficult for the Fed to justify near-term interest rate cuts (“Monetary Policy” moved to negative).

As mentioned above, our national debt also continues to climb, recently eclipsing 100% of GDP (see below left).[vi] We believe this is, at least in part, driving long-term Treasury bond yields higher.[vii] We are also seeing stress at the household level, as delinquencies in credit card debt, student loans, auto loans, and mortgages are all trending higher (see below right).[i]

It is worth noting that rising debt levels alone rarely cause economic downturns. However, when considered alongside rising inflation and all-time low consumer sentiment figures, they do serve to counterbalance the optimism we have witnessed in equity markets recently.[i] They also create a challenging situation for the new Federal Reserve Chair, Kevin Warsh.

The Path Forward – IPO FOMO

With investors looking through the conflict in Iran, bullish sentiment appears to be back in control. Much of the optimism is warranted in our opinion, as we highlighted strong corporate earnings and continued AI infrastructure spending driving economic growth earlier in this piece.

Adding to that optimism is a trio of potential initial public offerings (IPOs) that appear to be coming soon. An IPO is when a private firm decides to make its shares available to the general public on a stock exchange like the New York Stock Exchange or the Nasdaq. It can provide the owners of the company with liquidity, provide the company with new sources of capital, and give the public an opportunity to invest in companies that were previously difficult to access for most investors.

SpaceX, OpenAI, and Anthropic have generated a tremendous amount of excitement this year because of their leadership positions in their respective domains and their sheer size. For example, SpaceX is the leading rocket launch service provider, the leader in low earth orbit satellite deployment (through Starlink), and a major social media platform (through X).[ii] Meanwhile, OpenAI and Anthropic are arguably the two most advanced AI labs in the world.

As mentioned above, the size of these companies also makes this situation unique. For perspective, the SpaceX IPO is expected to be the largest in history, with its estimated exit value exceeding that of all IPOs over the past decade combined (see below)

OpenAI and Anthropic, while not valued as high as SpaceX, both appear to be targeting IPO valuations of nearly $1 trillion. OpenAI, the company that brought artificial intelligence mainstream in November 2022 with the launch of ChatGPT, is targeting its public offering as early as September.[i] Last but not least is Anthropic, whose AI tool, Claude, has soared in popularity and helped to increase its valuation sixfold over the past year alone.[ii] As of the time of this writing, Anthropic confjjjidentially filed a draft proposal to go public.[iii] If the three companies go public at estimated valuations, they will all become top 20 holdings in the S&P 500 based on current valuations.[iv]

Two other factors make this environment unique – the rise of passive investing and index providers potentially changing their rules to participate in the IPOs. Passive investing has risen significantly over the past few decades, with studies finding that approximately half of all global equity investing is in passive strategies.[18] As a result, being added or removed from an index can bring with it significant capital flows into or out of your company stock, meaning index providers exercise a tremendous amount of power through the rules they establish.

Currently, index providers such as Nasdaq, S&P Dow, CRSP, and FTSE Russell are revisiting their criteria for index inclusion. As of publication date, Nasdaq, FTSE Russell, and CRSP have modified their methodologies to allow for faster entry into indexes, with potential index inclusion after five trading days post-IPO for CRSP and FTSE Russell, fifteen trading days for Nasdaq. S&P Dow has not currently announced any methodology changes; however, they are reportedly considering similar modifications. Wherever index providers choose to draw their lines, differences in methodologies related to IPOs (not just inclusion timing, but also in float levels and liquidity/profitability measures) may result in differences in performance and volatility for index-based investments.[19]

We believe that the addition of SpaceX, OpenAI, and Anthropic to public markets is a positive. All three are industry leaders in incredibly important fields. Allowing investors greater access to them is a positive in our opinion.

However, we have found that in bullish market environments, the fear of missing out, or FOMO, can lead investors to make irrational decisions. Fundamental investing pillars like valuation and profitability, and risk management concerns such as solid corporate governance and key-person risk are often abandoned at the worst times. We encourage investors to exercise patience in such times, and to recognize that speculating and long-term investing are very different exercises.

As always, we appreciate your continued trust and welcome the opportunity to speak with you in greater detail regarding your specific situation.

Sources & References

[1] Source: YCharts, May 31, 2026 – for all performance returns above

[2] Source: The Wall Street Journal, “Oil Declines Lift Stocks to Fresh Records,” May 29, 2026. https://www.wsj.com/finance/stocks/oil-declines-lift-stocks-to-fresh-records-243d065e?mod=Searchresults&pos=1&page=1

[3] Source: The Wall Street Journal, “Oil Declines Lift Stocks to Fresh Records,” May 29, 2026. https://www.wsj.com/finance/stocks/oil-declines-lift-stocks-to-fresh-records-243d065e?mod=Searchresults&pos=1&page=1

[4] Source: The Wall Street Journal, “US Debt Tops 100% of GDP,” April 20, 2026. https://www.wsj.com/economy/u-s-debt-tops-100-of-gdp-81c013d7?mod=article_inline

[5] Source: YCharts, May 31, 2026 – for GDP and unemployment data

[6] Source: https://www.atlantafed.org/research-and-data/data/gdpnow#tab-2

[7] Reference: https://www.investmentresearchpartners.com/post/the-dashboard-may-2026

[8] Source: YCharts, May 31, 2026

[9] Source: The Wall Street Journal, “US Debt Tops 100% of GDP,” April 20, 2026. https://www.wsj.com/economy/u-s-debt-tops-100-of-gdp-81c013d7?mod=article_inline

[10] Source: Financial Times, “What will drag the financial system into another crisis,” April 20, 2026. https://www.ft.com/content/5a648eba-6677-47c8-89a6-71e2fb4d6fce?syn-25a6b1a6=1

[11] Source: The Wall Street Journal, “Americans Are Falling Behind on Their $1.25 Trillion Credit Card Bill, May 29, 2026. https://www.wsj.com/personal-finance/credit/us-credit-card-debt-af5c7c77?mod=Searchresults&pos=1&page=1

[12] Source: YCharts, June 2, 2026

[13] Source: Morningstar, “SpaceX: What Investors Neet To Know About Its Enormous Upcoming IPO,” June 1, 2026. https://www.morningstar.com/stocks/spacex-what-investors-need-know-about-its-enormous-upcoming-ipo

[14] Source: https://www.ft.com/content/028a169f-cd1c-438b-b50d-df4af6297318?syn-25a6b1a6=1

[15] Source: https://www.ft.com/content/a40cafcc-0fa4-4e70-9e24-90d826aea56d?syn-25a6b1a6=1

[16] Source: Bloomberg, “Anthropic Files Confidentially for IPO in Race With OpenAI,” June 1, 2026. https://www.bloomberg.com/news/articles/2026-06-01/anthropic-files-confidentially-for-ipo-as-claude-demand-surges?cmpid=eveus&utm_campaign=eveus&utm_medium=email&utm_source=newsletter&utm_term=260601&utm_content=5061

[17] Source: YCharts, May 31, 2026

[18] Source: Felix von Moltke and Torsten Sløk, “Assessing the Impact of Passive Investing over Time,” November 2024. https://www.apolloacademy.com/wp-content/uploads/2024/11/Passive-Investing-Paper-vF-112224_STAMPED.pdf

[19] Investment News, “SpaceX’s index fund debut will look nothing like what most investors expect,” May 28, 2026. https://www.investmentnews.com/practice-management/spacexs-index-fund-debut-will-look-nothing-like-what-most-investors-expect-says-jacob-friedman/266776

May Monthly Dashboard

Each month's dashboard comes with a detailed research report covering charts, sector analysis, and portfolio positioning not included here. Access to the full report

Executive Summary

Equity markets rallied throughout April, looking past geopolitical issues and inflation concerns, as many equity indexes closed the month near all-time highs.
Positive corporate earnings and announcements of record artificial intelligence (AI) infrastructure spending helped fuel robust equity market returns for the month.
The Federal Reserve held interest rates steady in its April meeting, as expected; however, the meeting will be remembered as the last in which Jerome Powell served as Chairman (Kevin Warsh is set to take over in mid-May).
Warsh will be inheriting the chair at a precarious moment, as markets wrestle with higher inflation, somewhat softer employment, and higher levels of uncertainty created by the Iran conflict and rapid AI growth

Markets Rally Through April

April delivered the strongest month for U.S. equities since the aftermath of the pandemic in 2020. The S&P 500 rose 10%, the Nasdaq Composite climbed 15%, and the Dow Jones Industrial Average gained 7%, with all three domestic stock indexes finishing at or near record highs.[1] Investors looked through the ongoing conflict in the Middle East, continuing high oil and gas prices, and the Federal Reserve at an inflection point, choosing instead to focus on first-quarter corporate earnings and continued spending on artificial intelligence infrastructure.

Beneath the index returns, dispersion was notable, however. Alphabet surged in April, posting a 34% monthly gain and the largest one-day market-cap increase in its history on April 30, ending the session valued at $4.65 trillion.[2] Outside of large tech, Caterpillar rose to a record close on AI-fueled demand for its power-generation equipment, a signal that the AI build-out is pulling industrial and utility names alongside the chip and cloud names.[3] In contrast, mega-cap tech companies Meta and Microsoft have been under pressure as investors pressed for evidence that AI capex is translating into earnings.

Emerging markets equities also rallied through April, led by a handful of technology companies, much as domestic stocks did. The MSCI Emerging Markets index gained approximately 15% for the month and closed near all-time highs, fully recovering its early Iran-war losses. AI beneficiaries Taiwan Semiconductor, Samsung Electronics, and SK Hynix generated almost half of the index’s monthly return and now account for nearly a quarter of the benchmark.[4]

Aside from stocks, other asset classes produced mixed results in April. As the Strait of Hormuz remained effectively closed, Brent crude traded above $100 a barrel for most of the month and U.S. retail gasoline remains elevated, as well. With inflation concerns still front of mind, the Bloomberg Commodity Index advanced about 4% for the month, bringing its year-to-date return to approximately 29% through April 30.[5]

The 10-year Treasury yield closed April at approximately 4.4%, holding near its post-cease-fire highs as investors trimmed expectations for Fed rate cuts and wrestle with the growth of our national debt (US public debt recently exceeded GDP for the first time since 1946).[6] That resulted in bonds being essentially flat for the month, as the Bloomberg US Aggregate Bond index was up 0.11%. The dollar gave back much of its early-war safe-haven bid; the ICE US Dollar Index fell about 1.7% on the month, providing a tailwind for non-U.S. earnings. Gold slumped about 1% for April (see S&P GSCI Gold index above), as investors continue to search for a narrative for the precious metal.

AI Powers Economic Growth
The U.S. economy grew at a 2% annualized pace in the first quarter, a step up from the prior period (which had been weighed down by the longest federal government shutdown on record). Consumer spending decelerated to 1.6%, but stayed positive, helped by tax refunds and limited layoffs even as households absorbed higher fuel and food costs. The bigger contributor to growth was business investment, which advanced 10.4%, the fastest pace in nearly three years, with information processing equipment and software both posting outsized gains.[7]

The four largest hyperscalers (Alphabet, Amazon, Meta, and Microsoft) lifted their combined 2026 AI infrastructure budget to a record $725 billion, roughly 77% above last year’s record. That capital is flowing through the economy as data center construction, server and chip purchases, and grid and power-generation orders.

Inflation Pressures & Transition at the Fed
Serving as a counterbalance to AI enthusiasm, inflation continues to tick higher due to the conflict in Iran. Headline PCE rose 0.7% in March, the largest monthly print since 2022, lifted by oil and gas costs tied to the war. With retail gasoline near $4 a gallon, the highest level since 2022, consumer expectations for inflation over the next year jumped to 4.7% from 3.8% the prior month, while the five-year measure rose to 3.5%. Higher prices helped to push a consumer sentiment survey to an all-time low, and the personal savings rate slipped to its lowest level since late 2022 as the cost of living absorbed more of disposable income.[8]

The labor market remains relatively resilient by contrast. Nonfarm payrolls added 178,000 jobs in March, the unemployment rate edged down to 4.3%, and weekly jobless claims fell to levels last seen in the late 1960s. While the data remain solid, several large employers cited AI in announcing planned workforce reductions, which may also be weighing on consumer sentiment.

Lastly, the Federal Reserve is in the middle of a leadership handoff. Chair Jerome Powell’s term is wrapping up (although he intends to stay on as governor, only the second former Chair to do so since World War II), and Kevin Warsh, a Fed Governor from 2006 to 2011, moves into the leadership role at a delicate moment. Warsh’s public record over the past decade has emphasized inflation discipline, Fed independence, a leaner balance sheet, and less reliance on forward guidance than the Powell consensus, though investors will need to see his early actions and comments to calibrate that view.[9] Markets have already adjusted: rate-cut expectations for 2026 have been pared, the upper-bound fed funds target sits at 3.75%, and the 2-year Treasury yield has been trading above that at approximately 3.9%[10].

The Path Forward
Despite an onslaught of negative headlines throughout April (Iran conflict, rising inflation, falling consumer sentiment), equities rebounded with several parts of the market providing double-digit gains. It was yet another example of how difficult it is to predict near-term market movements and why we choose instead to focus on long-term objectives.

In our opinion, one of the biggest drivers of uncertainty today remains artificial intelligence. The technology has the potential to both dramatically enhance business productivity and economic growth, and to raise unemployment if it replaces employees. As we often state, the range of outcomes and time frames related to AI appears to us to be incredibly wide.

For example, please see “The Radiologist Paradox” chart from Apollo below. One of AI’s strengths is pattern recognition, which was on display as far back as 2016, when Google DeepMind’s AlphaGo program defeated renowned Go champion Lee Sedol.[11] Fast forward ten years, and you’d be forgiven for thinking that jobs like radiologists, which require high pattern recognition skills, would be in decline as AI improves. However, you’d be mistaken.

As Apollo’s Chief Economist, Torsten Slok, states, “A decade ago, AI was supposed to replace radiologists. Today, radiologists earn more than $500,000 per year, and their employment continues to grow (see chart below). Reading scans is a task, not a job, and when the task gets cheaper, demand for the job grows.”[12]

The example above illustrates why we think diversification is as important as ever. You can be right about the power of a technology such as AI and still draw the wrong conclusions. As Yogi Berra famously quipped, “It’s tough to make predictions, especially about the future.”[13]

Rather, we suggest investing in diversified portfolios in an effort to achieve your financial goals without tying success to any one trend or prediction. We appreciate your continued trust and welcome the opportunity to speak with you in greater detail regarding your specific situation.

Sources

[1] Source: YCharts, 4/30/2026

[2] Source: The Wall Street Journal, “Investors Ride Google, Caterpillar to Market’s Best Month Since 2020,” April 30, 2026. https://www.wsj.com/finance/stocks/investors-ride-google-caterpillar-to-markets-best-month-since-2020-ca0fc08a?mod=finance_feat4_stocks_pos3

[3] Source: The Wall Street Journal, “Investors Ride Google, Caterpillar to Market’s Best Month Since 2020,” April 30, 2026. https://www.wsj.com/finance/stocks/investors-ride-google-caterpillar-to-markets-best-month-since-2020-ca0fc08a?mod=finance_feat4_stocks_pos3

[4] Source: The Financial Times, “Emerging market stocks hit record high as Asian chipmakers surge,” April 29. 2026. https://www.ft.com/content/5a003a35-a48b-4e46-a2d3-b99ae41d0e46?syn-25a6b1a6=1

[5] Source: YCharts, 4/30/2026

[6] Source: The Wall Street Journal, “US Debt Tops 100% of GDP,” April 20, 2026. https://www.wsj.com/economy/u-s-debt-tops-100-of-gdp-81c013d7?mod=article_inline
[7] Source: Bloomberg, “The AI Boom is Cushioning the US Economy from Iran War Impact,” April 30, 2026. https://www.bloomberg.com/news/articles/2026-04-30/us-economy-boosted-by-ai-boom-in-way-to-blunt-iran-war-impact

[8] Source: Bloomberg, “US Consumer Sentiment Falls to Record Low on Inflation,” April 24, 2026. https://www.bloomberg.com/news/articles/2026-04-24/us-consumer-sentiment-falls-to-record-low-on-inflation-anxiety

[9] Source: Bloomberg, “Warsh Eyes Fed ‘Regime Change’ With Less Talk, New Models,” April 30. 2026. https://www.bloomberg.com/news/articles/2026-04-30/warsh-eyes-fed-regime-change-with-less-talk-new-models?srnd=phx-economics-v2

[10] Source: Bloomberg as of April 30, 2026

[11] Source: Sebastian Mallaby, “The Infinity Machine,” published by Penguin Press, 2026

[12] Source: Apollo, “The Daily Spark,” April 29, 2026. https://www.apollo.com/wealth/the-daily-spark/the-radiologist-paradox?utm_medium=email&utm_source=pardot&utm_id=1feca30be61a1077771319ee7e2f5367&utm_campaign=EXT_Daily+Spark

[13] Source: Goodreads, https://www.goodreads.com/quotes/261863-it-s-tough-to-make-predictions-especially-about-the-future

IMPORTANT DISCLOSURES:

The Pacific Financial Group, Inc. (“TPFG”) is a registered investment adviser. The commentary above was produced by Investment Research Partners, LLC, and is being redistributed by TPFG with their permission. Opinions and forecasts regarding markets, securities, or portfolios are given as of the date provided and are subject to change at any time. The commentary is being provided for informational and educational purposes only. The commentary should not be construed or interpreted as an offer or solicitation to purchase or sell a financial instrument and should not be relied on or deemed the provision of tax, legal, accounting or investment advice. All investments contain risks to include the total loss of invested principal.

CID 11964642660

The Dashboard

July Monthly Dashboard

Executive Summary:

Equity Markets Up YTD, But Stall in June

Markets Remain Optimistic on Conflict Resolution

Changing of the Guard at the Fed

Market Concentration & Leverage Create Volatility Concerns

The Path Forward

Sources & References

June Monthly Dashboard

Executive Summary:

May Monthly Dashboard

Corporate Plans

Healthcare Plans

Education Plans

Government Plans

Have a question? Just Ask Us!

ABOUT

OUR SERVICES

CONTACT US