U.S. equities were little changed last week, with the S&P 500 gaining 0.1% and the Nasdaq advancing 0.4%, while the Dow slipped 0.3%. Despite the quiet week, returns for 2026 remain strong, with the S&P 500 up 12.8%, the Nasdaq 14.0%, and the Dow 11.1% year to date. Investors spent much of the week balancing continued strength in technology and artificial intelligence against higher energy prices and elevated interest rates. Friday’s stronger-than-expected employment report reinforced the resilience of the U.S. economy but also pushed expectations for another interest-rate increase higher. The 10-year Treasury finished the week at 4.78%. As we enter the final months of what has already been a rewarding year, our outlook remains constructive but somewhat more cautious. Consumers are working and spending, corporate profits remain healthy, and economic growth continues, but strong year-to-date market gains, higher rates, and ongoing geopolitical uncertainty argue for maintaining discipline rather than chasing returns. We continue to believe investors are best served by remaining diversified and focused on their long-term investment plans.

U.S. & Global Economy

• The U.S. economy continues to demonstrate more resilience than many expected. August payrolls increased by a solid 162,000 jobs, while the unemployment rate remained low at 4.1%, reinforcing the important role of a healthy labor market in supporting consumer spending and economic growth. Wage growth remained reasonable at 3.1% year-over-year, while second-quarter productivity increased 1.4%, both encouraging signals for the economy. However, the combination of stronger jobs numbers and still-elevated inflation has increased the odds of a rate hike at the Fed’s next meeting on September 16, with current expectations favoring a quarter-point increase. Globally, growth remains mixed but generally stable despite geopolitical and trade uncertainty. Our outlook remains constructive; however, with inflation still above target and interest rates likely to remain elevated, we believe some caution is appropriate as we move through the final months of 2026. The economy remains on a solid footing, but after a strong year for financial markets, investors should not expect the path forward to be without some bumps.

Policy and Politics

• Geopolitical tensions moved back to the forefront last week as renewed fighting between the U.S. and Iran increased concerns about energy supplies and the Strait of Hormuz. Oil prices responded sharply, with WTI gaining roughly 8% and Brent rising about 6% for the week, reversing much of the prior week’s decline. Diplomatic channels remain open, but the latest escalation is another reminder that progress in the Middle East is unlikely to follow a straight line. In Europe, new efforts are underway to restart negotiations between Russia and Ukraine, although intensified fighting and significant differences between the two sides suggest any lasting settlement remains a difficult and potentially lengthy process. U.S.-China relations also remain complicated, with new tensions surrounding trade and critical rare-earth supplies ahead of expected high-level discussions later this month. Despite this challenging global backdrop, financial markets have remained remarkably resilient. Geopolitical events will continue to create headlines and periodic volatility, but history reminds us that markets ultimately follow economic growth and corporate earnings rather than political events alone.

As we move into the final months of 2026, there is plenty for investors to digest, but we continue to see more reasons for optimism than concern. The economy is growing, consumers are working and spending, and corporate earnings remain healthy. The week ahead brings a few key earnings reports, including Oracle, Adobe, and Macy’s. Investors will also be watching this week’s CPI and PPI readings closely, as oil prices continue to rise and could put renewed pressure on inflation. With inflation and interest rates not yet where we would like them to be, and geopolitical events likely to create more headlines and volatility, we believe a measured approach remains appropriate rather than chasing markets higher. Patience, diversification, and the discipline to look beyond the daily noise have served investors well this year, and we believe they remain the right approach as we head toward year-end. As always, please contact your team at Valley National Financial Advisors with any questions.

Economic Numbers to Watch This Week

• U.S. NFIB Index of Small Business Optimism for August 2026, prior 99.8
• U.S. Consumer Credit for July 2026, prior 14.2B
• U.S. Weekly Jobless Claims for September 5, 2026, prior 206K
• U.S. PPI for August 2026, prior 0%
• U.S. Ex-Food & Energy PPI, M/M% for August 2026, prior 0.2%
• U.S. PPI, Y/Y% for August 2026, prior 4.7%
• U.S. Monthly Wholesale Trade for July 2026, prior 0.2%
• U.S. Existing Home Sales for August 2026, prior 4.1M
• U.S. CPI for August 2026, prior 0.1%
• U.S. Core CPI, M/M% for August 2026, prior 0.2%
• U.S. CPI, Y/Y% for August 2026, prior 3.4%
• U.S. CPI Core, Y/Y% for August 2026, prior 2.5%
• U.S. U. Michigan Prelim Consumer Survey for September 2026, prior 51

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