(Market information current as of September 2, 2026)
If last month’s market theme was resilience, August brought another encouraging development: participation.
Stocks continued moving higher during much of the month, but what was especially encouraging was that the gains weren’t coming from only a handful of the largest technology companies.
More areas of the market were participating.
Why Broader Participation Matters
Last month, we introduced an old Wall Street saying: “If the troops lead, the generals will follow.”
The “generals” are the largest companies that carry tremendous weight within indexes like the S&P 500. The “troops” represent the hundreds of other companies that make up the broader market.
When more of those companies are moving higher together, it’s generally considered a healthier sign than when only a few large companies are carrying the market.
That was one of the more encouraging trends we saw during August.
The Federal Reserve’s Job Just Became More Difficult
There’s an old Wall Street saying: “Don’t fight the Fed.”
In simple terms, when the Federal Reserve raises interest rates, it’s trying to slow the economy and bring inflation down. The challenge today is that inflation remains stubbornly above the Fed’s 2% target, and rising energy prices from geopolitical tensions could make that problem even more difficult.
New Fed Chairman Kevin Warsh reinforced a more cautious—or “hawkish”—stance during his first Jackson Hole speech in late August. While noting that the economy remains resilient, he made it clear that the Fed remains focused on bringing inflation down and is prepared to act if it stays too high.
That has changed the conversation on Wall Street. Instead of focusing on when interest rates might come down, investors are now considering whether rates may need to stay higher for longer—or potentially move higher again if inflation doesn’t improve.
Energy Prices Are Back in the Spotlight
The conflict involving Iran escalated again as August came to an end, renewing concerns about oil and energy supplies from the Middle East.
And the issue isn’t only crude oil.
The global supply of refined products—including gasoline and diesel—has also been under pressure. If those costs remain elevated, they can eventually work their way into transportation, shipping, airfare, and many of the goods and services we purchase every day.
That’s important because higher energy costs can also make inflation more difficult to control.
For retirees and those approaching retirement, inflation matters because even relatively small increases in everyday expenses can become significant when you’re planning for income that may need to last 20 or 30 years.
Should Investors Be Worried?
There are certainly reasons to remain watchful.
We’re heading into September, historically a challenging month for stocks. We’re also in a midterm election year, interest rates remain important, and geopolitical uncertainty hasn’t disappeared.
But that doesn’t mean investors should react to every headline.
Despite everything the markets have absorbed this summer, the broader trend has remained positive. More companies have participated in the market’s advance, corporate earnings have generally remained supportive, and volatility remained relatively subdued through much of August.
That doesn’t mean markets will continue moving higher. Pullbacks are a normal part of investing.
What This Means for Retirement Investors
For someone approaching or already in retirement, the goal shouldn’t be to predict what the market will do next.
The more important question is whether your retirement strategy is prepared for different market environments.
That means looking beyond investments alone and considering how your income, withdrawals, investment risk, taxes, Social Security, healthcare costs, and other financial decisions work together.
Markets will change. Interest rates will change. Inflation will change. And today’s headlines will eventually be replaced by new ones.
A good retirement plan should be designed with that reality in mind.
Source: Federal Reserve Board, Chairman Kevin Warsh’s Jackson Hole Economic Policy Symposium remarks (August 28, 2026); Reuters; market data available through September 2, 2026.
Source: U.S. Energy Information Administration and market data available through September 2, 2026.
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