[Recap] U.S. Stocks Post a Positive Week Despite Friday’s Pullback – New Fed Chair Warsh Turns Hawkish, August Jobs Report Looms Next Week

Hey everyone, Hirokichi here. This time I’m looking back at the U.S. stock market for the week of August 24-28, 2026. It was a volatile week dominated by two big events: Nvidia’s earnings and the Jackson Hole symposium. Let’s walk through how Friday’s close (8/28) shaped up, what to expect next week, and what new Fed Chair Kevin Warsh said in his first-ever Jackson Hole keynote.

The bottom line: Friday dipped, but the week stayed in positive territory

Let’s start with the conclusion. On Friday, August 28, all three major indexes closed lower on the day.

– S&P 500: 7,711.76 (down 19.23 points, -0.2%)
– Dow Jones Industrial Average: 53,559.99 (down 9.45 points, -0.1%)
– Nasdaq Composite: 26,402.42 (down 138.93 points, -0.5%)
– Russell 2000 (small-cap index): 2,972.37 (down 41.97 points, -1.4%)

Friday alone looks like a down day, but the picture changes when you zoom out to the full week (Monday through Friday). The S&P 500 and the Dow both gained +0.5% for the week, while the Nasdaq added +0.8%. The only loser was the small-cap-heavy Russell 2000, which finished the week down -1.5%. So the real story of the week is: Friday pulled back, but the week as a whole held up.

The surge from Thursday’s Nvidia-driven rally to Friday’s pullback after Warsh’s remarks shows just how much the second half of the week moved.

Chip weakness on Monday, then Nvidia’s earnings became the week’s biggest event

Let’s walk through the week day by day.

Monday (8/24) started on a soft note, with weakness in chip stocks weighing on the Nasdaq (-0.76%) while the S&P 500 slipped -0.28%. The Dow, on the other hand, held up with a +0.26% gain — a mixed picture depending on the index. Investors’ attention was already turning toward Nvidia’s earnings, due after Wednesday’s close, and the Jackson Hole symposium (the Fed’s annual economic conference) scheduled for the end of the week.

Tuesday (8/25) saw all three indexes rise (S&P 500 +0.3%, Dow +0.3%, Nasdaq +0.7%) as falling oil prices eased worries in the bond market. Wednesday (8/26) was quiet, with an inflation reading coming in slightly hotter than expected and putting the market in wait-and-see mode (the S&P 500 finished nearly flat).

Then on Thursday (8/27) came the week’s headline event: Nvidia’s earnings. Revenue came in at $96.2 billion (up 106% year over year) and EPS (earnings per share) hit $2.22, both beating estimates, while the company guided next quarter’s (Q3 FY2027) revenue to $108 billion, a bullish outlook. Nvidia shares surged roughly 8.7% in a single day on the news. With the results reaffirming resilient AI-related demand, the Nasdaq jumped +1.6% and the S&P 500 gained +0.7%, briefly nearing record territory.

Friday’s Jackson Hole speech: new Fed Chair Warsh turns hawkish

The final trading day of the week, Friday (8/28), was all about the Jackson Hole symposium held in Wyoming. This annual conference, hosted by the Federal Reserve every August, has historically been a venue where Fed chairs signal the direction of monetary policy.

What made this year especially notable was that it marked new Fed Chair Kevin Warsh’s very first keynote address since taking office (Warsh succeeded former Chair Powell earlier this year).

In his speech, Warsh said “Inflation is running above our 2% target. So the Fed’s predominant focus right now should be on prices,” expressing clear concern that inflation is currently running around 3.4-3.7%. While he stopped short of committing to a specific timeline for rate hikes or cuts, his remarks were enough to send September rate-hike odds sharply higher, jumping from roughly 33% before the speech to over 50% afterward.

Short-term yields rose while longer-dated yields fell, a pattern known as a “bear flattener,” and small caps (the Russell 2000), which are especially sensitive to rising rates, sold off hard as a result.

Warsh also made clear he’s skeptical of detailed forward guidance on future rate paths, framing his approach as building credibility “through results rather than promises,” a quieter Fed. In fact, at the June meeting the Fed took the unprecedented step of skipping publication of its quarterly rate projections (the so-called dot plot). For markets, this effectively means a Fed whose next move is harder to read, which is likely to keep volatility elevated in both stocks and bonds for a while.

A tale of two markets: large caps vs. small caps

The chart below shows the weekly percentage change for the week of August 24-28 across four major indexes.

The S&P 500, Dow, and Nasdaq all held onto gains for the week, while the Russell 2000 was the lone index in the red. That’s because Warsh’s hawkish tone pushed up rate-hike expectations, which weighs more heavily on smaller companies that are more sensitive to borrowing costs. Large-cap tech, by contrast, had Nvidia’s blowout earnings as a strong tailwind that helped offset the headwind from rising rates.

Next week’s outlook: all eyes on the August jobs report due September 4

The single biggest event to watch next week (August 31 – September 4) is the August jobs report (nonfarm payrolls), due out at 8:30 a.m. ET on Friday, September 4.

Here’s why it matters so much: July’s jobs report showed nonfarm payrolls falling by 23,000, an unusual negative print that had raised concern about a slowing economy. At the time, that weak number had actually pushed September rate-hike odds down. But Warsh’s hawkish Jackson Hole remarks flipped the narrative, with markets now focused more on stubbornly high inflation than on labor-market softness.

In other words, next week is shaping up to be a tug-of-war between two very different worries: is the labor market weak or bouncing back, and is inflation staying elevated. If the August jobs report comes in weak again, rate-cut expectations tied to a slowing economy could resurface and act as a tailwind for stocks. If jobs come in stronger than expected, that combined with Warsh’s comments could push rate-hike expectations even higher, acting as a headwind for equities. It’s also worth noting that the next FOMC meeting is September 15-16, so next week’s jobs data will feed directly into that decision. The current policy rate remains in a range of 3.50%-3.75%.

Beyond the jobs report, keep an eye on the ISM Manufacturing PMI (typically released early in the month) and whether the AI/semiconductor rally sparked by Nvidia’s earnings has legs. Personally, I expect a wide-ranging week depending on how the jobs data lands, so I plan to avoid leaning too hard in either direction and just take the data one release at a time.

Wrap-up

This week’s U.S. market was a mix of tailwinds and headwinds: Nvidia’s strong earnings on one side, and new Fed Chair Warsh’s hawkish tone on the other. The result was a week that stayed positive for the major indexes even as Friday ended on a down note. With the August jobs report as next week’s big catalyst, whether the market leans toward worrying about inflation or the labor market will likely determine which way prices move.

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