May Market Update: Navigating Global Shifts with Discipline

Insights

Economic news kept markets moving dynamically over the last few weeks. Inflation data came in higher than expected, while technology earnings continued to drive equity markets to new milestones. At Tomoro, we remain focused on helping you cut through the short-term noise to maintain a clear, long-term perspective.

What Changed

• Inflation and Interest Rates: The Consumer Price Index (CPI) rose 0.6% month-over-month, pushing the annual headline rate to 3.68%. Producer prices also came in higher than expected. This persistent inflation caused bond yields to rise as the market pushed out expectations for future interest rate cuts.
• Global Equity Momentum: The S&P 500 reached new record highs, supported by corporate earnings growth. Growth continues to expand beyond tech, with earnings expectations for international and emerging markets showing notable strength due to global technology supply chain buildouts.
• Leadership at the Federal Reserve: The Senate confirmed Kevin Warsh as the new Federal Reserve Chair. This transition introduces a fresh perspective to policy outlooks, particularly regarding how the central bank communicates its future choices to the public.

Why It Matters

Persistent inflation and shifting central bank policy mean that interest rates may remain elevated for longer than the public anticipated a few months ago. This environment creates a clear divergence across asset classes.

While bond markets are adjusting to higher yields, corporate earnings remain robust. Growth is no longer confined to a few dominant technology firms. It is expanding into sectors like energy, healthcare, and infrastructure, as well as international regions that support global infrastructure.

This backdrop reinforces why we look at portfolios holistically. Rather than looking at asset classes in isolation, we coordinate growth assets and income assets to keep your wealth moving forward productively.

Portfolio Hygiene Checklist

• Review Cash Equivalents: With treasury yields retesting the 5% level, short-term holding vehicles and cash management strategies offer highly competitive yields. Ensure your cash buckets are optimized.
• Rebalance Strategically: Strong equity performance can inadvertently alter your target asset allocation. We can review your portfolio to ensure your risk exposure still matches your timeline and goals.
• Coordinate with Professionals: Rising rates and changing global dynamics can impact business planning and tax strategies. We recommend connecting with your CPA and attorney to keep your estate and corporate structures fully aligned.

The Path Forward

A changing macro environment does not mean you need to reinvent your strategy. It means you must remain disciplined. When bond yields shift and equity leadership expands, the most effective response is to rely on steady execution rather than emotional reactions.

We are continuously monitoring these global trends and adjusting the details behind the scenes. Our goal is to ensure your personal balance sheet remains resilient, your cash flows stay optimized, and your long-term goals stay entirely on track. As always, contact your advisor if you have any questions regarding your plan or to schedule a check-in. 

General Disclosure: This material is for informational purposes. It is not individualized investment, tax, or legal advice. All investing involves risk. Strategies depend on each client’s goals, timeline, and risk tolerance. Please consult a qualified professional before implementing any tax or legal strategy.

Sources:

• Goldman Sachs Asset Management, Market Monitor: Week of May 11, 2026
• Raymond James Bond Market Commentary
• BlackRock Investment Institute, Weekly Investment Commentary: Upping developed stocks strategically