Wall Street Week Ahead: Data, Iran, US-China meeting in focus for scorching US stock market

NEW YORK: The rallying US stock market will take its cues this week from fresh inflation and consumer spending data, developments in the war in Iran, and a high-stakes meeting between the leaders of the US and China.

US equities have been on a tear, with the benchmark S&P 500 up more than 15 percent from its low for the year, hit in late March. The strongest US quarterly earnings season in more than four years has lifted sentiment for equities, while worries about worst-case economic fallout from the Iran war have abated and investors are jumping in for fear of missing out on gains.

“We have seen this tremendous rebound as markets have willed themselves to focus on only the positive,” said Kristina Hooper, chief market strategist at Man Group.

Hopes for an end to the Middle East conflict, which began in late February with US-Israeli strikes on Iran, remain at the forefront for Wall Street. In particular, investors are eager to see a reopening of the Strait of Hormuz, a critical choke point for global oil supplies. Energy prices have soared in the wake of the Iran war, with US crude up more than 60 percent for the year.

“The continued progress towards a resolution for the US-Iran war will be top of mind for investors,” said Michael Arone, chief investment strategist at State Street Investment Management. “You need to begin to see ship movements in the Strait of Hormuz.”

The war is also expected to be a topic when US President Donald Trump meets with Chinese President Xi Jinping in Beijing late this week. Investors will monitor any developments between the two nations on access to rare earths and technology, as well as other issues.

The market’s latest surge, which has pushed the S&P 500 up 7 percent for 2026 as of Thursday, builds on three consecutive years of double-digit returns. The technology-heavy Nasdaq Composite was last up 11 percent on the year, with both indexes hitting record levels.

While the first-quarter results season is winding down, corporate reports will remain a key driver for stocks in the coming days. This week’s results include tech networking equipment firm Cisco and semiconductor equipment maker Applied Materials. Heavyweights Nvidia and Walmart are due later in the month.

S&P 500 earnings are on track to jump 28 percent in the quarter, according to LSEG IBES data. Massive corporate spending on artificial intelligence is flowing through to the results of several industries, as AI hyperscalers build out data centers and other infrastructure to support the technology.