This week in markets: 5/13 - 5/17

The S&P 500 capped off its fourth-straight week of gains after a rollercoaster of a week for public markets, in which we saw meme traders make a brief but memorable comeback, measures of inflation calm down anxious Fed watchers, and the market enjoying its best week of gains since February.

All three major indexes hit all-time highs this week after Wednesday’s consumer price index (CPI) showed that inflation was finally cooling, giving eager investors a shred of hope that the Fed might cut rates sometime in the near(ish) future. Yet while the stock market was rewarded after the Fed’s monetary policy finally saw a small victory in its war of attrition, economists made it clear we’re not in the clear when it comes to obnoxiously high prices.

The Dow breached the 40,000 level briefly on Thursday for the first time ever. The S&P 500 also flirted with another all-time high this week, while the Nasdaq also had a big week thanks to meaningful gains among semiconductor stocks.

The week kicked off with a strong comeback of Roaring Kitty, the notorious architect of the meme stock frenzy of 2021. Yet this week’s retail trading craze was short lived — after AMC and GameStop looked to cash out on their brief market gains, shares had mostly deflated by the week’s end.

Strong corporate earnings also boosted the market, with companies like Walmart reporting better-than-expected profit and revenue figures, signaling to traders that consumer demand may be recovering even while economic headwinds remain.

Another boon this week was a deal between OpenAI and Reddit, as media companies continue to create opportunities for revenue from content licensing deals with AI firms. While some see this as a deal with the devil, others see it as inevitable, and a financial lifeline for social (and traditional) media companies to stay afloat.

Looking ahead, all eyes will be on Nvidia, the reigning AI chipmaker, when it reports its earnings on Wednesday. The AI behemoth is up a staggering 96% this year alone.