This content was published on
August 14, 2026 - 16:03
4 minutes
(Bloomberg) — Wall Street is ending the week with stocks near all-time highs as bets the Federal Reserve will remain on hold in September were reinforced by a drop in consumer sentiment and retail sales.While the S&P 500 barely budged on Friday, the index headed toward its third straight weekly advance. That would be the longest winning streak since May. Short-dated Treasuries outperformed. The dollar fell. Oil wavered as the US threatened to impose multiple economic measures against Iran in a bid to force its hand to reopen the Strait of Hormuz.US consumer sentiment fell for the first time in three months as households worried about worsening business conditions and rising inflation. Meantime, retail sales slipped by the most in more than a year as consumers pulled back on purchases at online stores and auto dealers.Unexpected weakness in consumer spending isn’t good news for the wider economy, but markets may embrace the data in the near term because it strengthens the case for avoiding rate hikes, according to Ellen Zentner at Morgan Stanley Wealth Management.“Overall, it was a troubling update on the overall health of the consumer,” said Ian Lyngen at BMO Capital Markets. “This will contribute to the case for a Fed pause next month.”The retail sales report suggests consumers took a breather after a stronger first half of 2026. It also follows data showing moderating inflation, which may give the Fed some time to wait as it debates whether to lift borrowing costs at its Sept. 15-16 meeting.Economic weakness is a steep price to pay to avoid a quarter-point hike, particularly when markets have largely shrugged off that concern and earnings remain resilient, according to Bret Kenwell at eToro.“For the economy to stay resilient, consumers will need to do the same,” he added.The economy is highly dependent on consumer spending, so it’s a case of be careful what you wish for, because a big slowdown could end up hurting corporate profits and the stock market, noted Chris Zaccarelli at Northlight Asset Management.“But in an environment where inflation can cool down and the Fed can keep rates on hold as a result of that, would be very good for this bull market,” he said.Corporate Highlights:Tesla Inc. is planning to unveil a new roadster design with “flying” capabilities as soon as this month, the Information reported. SpaceX has completed a $60 billion acquisition of startup Cursor, a key part of Elon Musk’s bid to gain ground on rivals Anthropic PBC and OpenAI. Applied Materials Inc. gave a solid forecast that still underwhelmed investors, a sign of the lofty hopes surrounding a company that’s key to the AI boom. Reddit Inc. will join the S&P 500 next week as part of an off-cycle change. It replaces AvalonBay Communities Inc. Gemini Space Station Inc., the digital-asset platform led by the billionaires Tyler and Cameron Winklevoss that went public last year just before the crypto market tumbled from record highs, posted a fourth consecutive quarterly loss since the IPO. Some of the main moves in markets:StocksThe S&P 500 was little changed as of 10:02 a.m. New York time The Nasdaq 100 rose 0.2% The Dow Jones Industrial Average was little changed The Stoxx Europe 600 fell 0.1% The MSCI World Index rose 0.1% CurrenciesThe Bloomberg Dollar Spot Index fell 0.4% The euro rose 0.4% to $1.1579 The British pound rose 0.5% to $1.3552 The Japanese yen rose 0.3% to 158.99 per dollar CryptocurrenciesBitcoin fell 1.3% to $62,552.3 Ether fell 1% to $1,866.51 BondsThe yield on 10-year Treasuries advanced two basis points to 4.66% Germany’s 10-year yield advanced six basis points to 3.19% Britain’s 10-year yield advanced six basis points to 5.01% CommoditiesWest Texas Intermediate crude was little changed Spot gold rose 0.9% to $4,388.46 an ounce ©2026 Bloomberg L.P.
