As we head into Memorial Day weekend, we want to take a moment to honor the men and women who gave everything in service to this country. Their sacrifice is the foundation on which everything else rests — including the freedom to plan, invest, and build a future. We hope you get to spend the long weekend with the people who matter most to you.
The American consumer kept spending in April — retail sales rose 0.5% for the month and are up 4.9% from a year ago. That resilience showed up in this week’s earnings. Walmart posted revenues up 7.3% with e-commerce growing 26%. Target delivered its first positive comparable sales number in five quarters — up 5.6% — and doubled its full-year sales growth outlook to 4%. Home Depot and Lowe’s both beat expectations and reaffirmed guidance, though both noted the housing market remains constrained by high mortgage rates and low inventory. It’s also worth noting that while the S&P 500 has climbed this month, much of that gain is concentrated at the top — the equal-weight version of the index is roughly flat, with AI and technology names doing most of the heavy lifting.
The housing market offered a few encouraging data points this week. Pending home sales rose 1.4% in April and are up 3.2% year-over-year, while housing starts came in above forecast at 1.465 million units. The caveat: single-family starts pulled back 9%, mortgage rates remain near 6.5%, and economists are cautioning that without more supply, home price growth could outpace wages. A meaningful housing recovery likely still requires lower rates.
Nvidia delivered another record quarter on Wednesday — revenue of $81.6 billion, up 85% from a year ago, with Data Center revenue hitting $75.2 billion. CEO Jensen Huang called the AI infrastructure buildout “the largest infrastructure expansion in human history,” with hyperscalers (large-scale cloud service provider that offers massive computing, storage, and networking infrastructure to businesses and individuals) collectively planning to spend roughly $725 billion on AI infrastructure this year alone.
The Federal Reserve released minutes from its April meeting showing a central bank more divided than it has been in decades — four members dissented, the most since 1992, and a majority indicated rate hikes could become appropriate if inflation stays above 2%. Rate cuts are no longer expected this year, and markets now assign roughly a 40% probability to a hike before year-end. These were also the final minutes under Jerome Powell, as Kevin Warsh now takes the helm. On the geopolitical front, U.S.-Iran negotiations showed tentative progress over the last 24 hours, with President Trump pausing a planned military strike after Tehran sent a new peace proposal through Pakistan. Both sides are working toward a framework agreement, though key sticking points, including Iran’s nuclear enrichment program, remain unresolved. Any durable deal could meaningfully ease energy prices. That would be welcome relief as we head into the summer months.
Interesting to Note
This morning the University of Michigan’s final May consumer sentiment reading came in at 44.8 — a record low, well below the preliminary estimate of 48.2, with gas prices, tariffs, and rising long-run inflation expectations all weighing on confidence. And yet, as this week’s earnings reports made clear, consumers are still spending. The gap between how people feel and how they actually behave remains one of the more unusual features of this economy.
Looking Ahead
New Fed Chair Kevin Warsh. His early comments and tone will set the stage for interest rate policy for the rest of the year. With rate hike risk now on the table, what Warsh says, and doesn’t say, will be closely watched by investors everywhere.
Housing market. Pending sales are inching higher and starts beat expectations, but a real recovery still needs lower mortgage rates. The single-family pullback in starts is worth monitoring as we move into the summer building season.
AI investment cycle. Nvidia’s results confirm the AI buildout is accelerating, not slowing. The scale of spending — $725+ billion this year from major tech companies alone — has broad implications for technology, energy, and the broader economy.
Enjoy the long weekend!
Written by: Chris Wasson, CFP®
Sources:
U.S. Census Bureau — April 2026 Retail Sales
Walmart Q1 2026 Earnings (WWD)
Target Q1 2026 Earnings (CNBC)
Home Depot Q1 2026 Earnings (Zacks/Yahoo)
Lowe’s Q1 2026 Earnings (CNBC)
NAR — Pending Home Sales April 2026
U.S. Housing Starts April 2026 (Trading Economics)
Nvidia Q1 Fiscal 2027 Earnings (SEC 8-K)
FOMC Minutes April 2026 (CNBC)
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