Top Nasdaq Composite and S&P 500 news to watch this week

• US-Iran military escalation has driven energy prices sharply higher, with gasoline above $4/gallon and diesel at multi-year highs, threatening to keep core PCE inflation elevated above the Fed's target
• August jobs report expected Friday showing 84,000 jobs added (vs. -23,000 in July), with strong data likely reinforcing case for December rate hike as Fed officials signal commitment to fighting inflation
• Broadcom and Oracle lead a slate of AI infrastructure earnings this week, capping a season where earnings growth hit 50%, though Oracle faces concerns over rising debt levels

Market Summary: Nasdaq and S&P 500 Weekly Outlook

Key Market Levels:

The Nasdaq Composite currently trades at 26,400 points (down from YTD high of 27,217), while the S&P 500 sits at 7,711 (down from 7,820), both hovering near all-time highs with a bearish AI sentiment score of 22/100.

Geopolitical Risk – US-Iran Tensions:

Escalating conflict following US attacks on Iranian launchers near the Strait of Hormuz threatens energy markets. Brent crude has risen to $90 and WTI to $85 per barrel, with gasoline exceeding $4/gallon and diesel at multi-year highs. This energy spike pressures inflation, which remained above 3% (headline and core PCE) in May.

Monetary Policy Implications:

Higher inflation could force the Federal Reserve to hike rates at the December meeting, according to Kevin Warsh's recent statements, creating headwinds for rate-sensitive tech stocks.

Critical Economic Data:

Friday's nonfarm payrolls report is the week's centerpiece, with economists expecting 84,000 jobs added in August (recovering from July's -23,000 loss). Additional data includes Tuesday's JOLTS report, ADP private payrolls, and manufacturing/services PMIs.

Corporate Earnings:

Major tech companies reporting include Broadcom (Tuesday) and Oracle, both critical AI infrastructure providers. Other notable releases: Dell, Medtronic, Snowflake, HP Enterprise, Ciena, and Zscaler. The earnings season has been robust, with growth reaching 50%.

Trading Implications:

Energy sector may outperform amid inflation concerns, while long-duration growth stocks face pressure from potential rate hikes. The combination of geopolitical uncertainty, inflation data, and Fed policy expectations creates elevated volatility risk for both indices.