Stocks rallied higher to close out the holiday-shortened week, with the S&P 500 logging its eleventh winning week out of twelve and small-company stocks crossing 20% on the year. That looks easy on paper, but it took some real twists and turns to get there. On Wednesday, our new Federal Reserve Chair held his first press conference, and his message was tougher on inflation than markets were expecting. For now, he told reporters, the Federal Reserve will stop offering its usual hints about where interest rates may be heading, and he made clear that controlling inflation comes first. Stocks dropped about 1% that afternoon. Then on Thursday, the United States and Iran signed their peace agreement in France, and the U.S. Navy lifted its blockade of the Strait of Hormuz, the narrow waterway where so much of the world’s oil flows. Oil prices fell sharply, and stocks rallied back. Friday added more good news, with Intel jumping 11% after President Trump posted on Truth Social that Apple had agreed to work with Intel to design and build chips in the United States. There is a lot to cover.
| Number of the Week
20% The Russell 2000’s year-to-date gain through Thursday’s close. The Russell tracks smaller U.S. companies, the kind that mostly do business here at home rather than overseas, and it is now leading every other major U.S. index this year. When smaller companies are doing this well, it usually means investors are feeling good about the U.S. economy. Lower oil prices, a steady labor market, and an end to the Iran war are all reasons to feel that way right now. |
| Market Snapshot — Week Ending June 18, 2026 |
| INDEX / ASSET | CLOSE | WK CHANGE | YTD |
| S&P 500 | 7,500.58 | ▲ 0.93% | ▲ 9.6% |
| Dow Jones | 51,564.70 | ▲ 0.71% | ▲ 7.3% |
| Nasdaq Comp. | 26,517.93 | ▲ 2.43% | ▲ 14.4% |
| Russell 2000 | 2,979.77 | ▲ 1.22% | ▲ 20.1% |
| Brent Crude | $80.05 | ▼ 8.3% | ▲ ~11% |
| Gold (Spot) | $4,172.90 | ▼ 1.6% | ▲ ~8% |
| 10-Yr Treasury | 4.49% | — flat | ▲ ~59 bps |
| VIX (Fear Index) | 16.78 | ▼ 0.90 — Calming | |
Data sources: Yahoo Finance, CNBC, Reuters, Investing.com, as of June 18, 2026 close. Markets were closed Friday June 19 for Juneteenth. Past performance is not indicative of future results.
| What Drove Markets Last Week |
Four trading days, three big stories, and a lot of headline whiplash for investors. Here is how it played out:
| Iran Peace Deal Signed
The United States and Iran officially signed their peace agreement in France on Thursday. The U.S. Navy lifted its blockade of the Strait of Hormuz that same day, and oil tankers began moving through the waterway again for the first time since the war began in late February. |
Fed Talks Tough on Inflation
In his first press conference, our new Federal Reserve Chair made clear that fighting inflation comes first, and dropped the usual hints about where rates may be heading. Half of his colleagues now see at least one rate hike before the end of the year. Stocks dropped about 1% on the news. |
Oil Tumbled to a Three-Month Low
Brent crude fell more than 8% on the week to about $80 a barrel, giving back nearly all the price spike from the Iran war. Cheaper oil means lower gasoline prices, less pressure on inflation, and less reason for the Federal Reserve to raise rates further. |
The bounce back Thursday and Friday is worth noting. After the Federal Reserve surprise on Wednesday, a lot of people expected the selloff to continue. Instead, the Iran peace signing, falling oil, and a big rally in semiconductor stocks turned the week green. Intel led the way Friday, surging 11% after President Trump announced on Truth Social that Apple had agreed to work with Intel to design and build chips here in the United States. The Nasdaq closed the week up more than 2%, the best of any major index. Over the weekend, the picture got a little more complicated. The Switzerland talks that had been canceled Friday went forward Sunday after all, with Vice President Vance meeting Pakistani and Iranian officials, and mediators reporting “encouraging progress.” At the same time, the rhetoric escalated, with President Trump threatening to take over the Strait of Hormuz if the deal fails and Iran responding that its military is ready to respond. The framework is holding, but the path forward remains fragile.
| What to Watch This Week (June 22 – 26) |
This week brings a full slate of economic data, and the report that matters most lands Thursday: Core PCE, the Federal Reserve’s favorite inflation gauge. Wednesday brings earnings from chipmaker Micron, which should tell us whether the AI spending boom is still going strong.
| KEY EVENTS THIS WEEK | |
| Mon 6/22 | Existing Home Sales (May) • Iran follow-on developments |
| Tue 6/23 | Consumer Confidence (June) • Two-Year Treasury Auction |
| Wed 6/24 | New Home Sales (May) • Five-Year Treasury Auction • Micron Technology earnings |
| Thu 6/25 | Core PCE Inflation (May) • Jobless Claims • Personal Income and Spending |
| Fri 6/26 | Michigan Consumer Sentiment (final) • Wholesale Inventories |
Thursday is the big one. Core PCE, which stands for Personal Consumption Expenditures, is the inflation report the Federal Reserve watches most closely. It tracks the same kind of price changes as CPI but covers a broader range of goods and services and adjusts for the way people actually shift what they buy when prices rise. With our new Federal Reserve Chair sounding tough on inflation and oil prices coming way down, this report carries real weight. A cool number would support the case for the Federal Reserve to leave rates alone. A hot number could put rate hikes back on the table.
Wednesday’s Micron earnings could move the entire chip sector. The stock has more than doubled since its last earnings report, so expectations are running very high. The Iran story also remains in motion. Weekend talks in Switzerland yielded what mediators called “encouraging progress,” but the rhetoric on both sides remains heated. Any meaningful setback could send oil prices right back up.
| The Big Picture — Our Take on the Markets |
The Wall Street proverb at the top of this letter has been on full display all year. Bull markets climb a wall of worry, and this market has had no shortage of worry to climb. Four months ago, oil was above $120 a barrel, the Middle East was at war, the Federal Reserve was widely expected to cut rates, and markets were under real pressure. Last week, oil closed below $80, the U.S. and Iran signed an interim peace agreement and the fighting paused, the Federal Reserve has shifted to a tougher stance, and the S&P 500 sits within striking distance of new all-time highs. Investors who held the course through all that uncertainty are now seeing the payoff.
Here is the interesting paradox underneath all of this. Corporate earnings keep beating expectations, more than 80% of S&P 500 companies have topped Wall Street forecasts this season. The economy keeps growing. The labor market keeps adding jobs. Consumers keep spending. Every one of those is exactly what you want to see if you are a long-term investor. The catch is that every one of them is also a little bit inflationary. Strong demand pushes prices up. A tight labor market pushes wages up. A growing economy uses more energy. None of that is bad, in fact, it is what a healthy economy looks like, but it does help explain why our new Federal Reserve Chair is being cautious about cutting rates. He is essentially saying the patient is doing well, so let us not overdo the medicine.
As the second quarter winds down, it is worth stepping back to look at how much ground this market has covered. Through all of it, the S&P 500 is up nearly 10%, small-company stocks are up more than 20%, and the rally is still climbing. That kind of resilience does not happen by accident, and it is why we believe staying engaged continues to be the right approach for long-term investors. As always, we are here to help.
| Where things stand as the second quarter winds down: the S&P 500 is up nearly 10% on the year, the Dow has crossed 51,000, the Nasdaq is up more than 14%, and small-company stocks are up more than 20%. This year, the market has worked its way through a Middle East war, a leadership change at the Federal Reserve, the hottest inflation in two years, and a tougher stance from policymakers, and still managed to grind higher. With more than 80% of S&P 500 companies beating earnings expectations this season, the underlying fundamentals continue to provide a strong foundation. |
If you have any questions about your portfolio or what any of this means for your specific situation, please don’t hesitate to reach out to your CIAS Investment Adviser Representative. We are here to help you navigate these markets with confidence.
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