“It’s not about being right or wrong, it’s about how much you make when you’re right and how much you lose when you’re wrong.” — Stanley Druckenmiller
Equity markets showed a divergence last week, with tech-heavy indices surging while broader benchmarks remained flat.
| Index | Performance |
| S&P 500 | +1.78% |
| NASDAQ | +3.67% |
| TSX Composite | -0.32% |
| Dow Jones | -0.11% |
Source: Bloomberg (May 7, 2026)
Each week, we break down the key events and market movements shaping the investing landscape. From economic data to investor sentiment and global headlines, this section captures what mattered most and how it impacted markets.
Microsoft’s latest data centre expansion plans reinforce that AI investment remains one of the market’s strongest secular growth drivers. The company is adding significant computing capacity to support rising enterprise AI demand, as hyperscalers prioritize long-term infrastructure buildouts. Notably, Microsoft has already secured more than 40 gigawatts of renewable energy capacity to support this cycle. For equity markets, these commitments support leaders in cloud computing, semiconductors, and enterprise software.
U.S. equities continued moving toward record highs as easing oil prices and improving sentiment supported a constructive backdrop for risk assets. The S&P 500 remained on track for a sixth consecutive week of gains, while lower Treasury yields helped reinforce expectations for economic resilience. Investors were encouraged by signs that consumer demand remains healthy, particularly across digital platform companies reporting stronger-than-expected results.
Long-term Treasury yields approached the 5% level this week as markets adjusted to resilient growth and evolving inflation expectations. While higher yields can increase short-term volatility, they also improve the long-term return potential in fixed-income markets. For portfolio positioning, the current environment reinforces the value of balancing quality equities with selectively attractive duration exposure.
We believe in transparency when it comes to where our outperformance is coming from. This section spotlights a top-performing company we hold, a sector where we've taken a winning position, and a strategy that has driven recent success across our portfolios.
Eli Lilly was our top performer last week with a remarkable 15.96% gain, as investors continued to reward the company's leadership in the rapidly growing market for obesity and diabetes treatments. Recent earnings and guidance reinforced strong demand for blockbuster medications Mounjaro and Zepbound, while progress on a new oral obesity treatment further boosted investor confidence. With expanding global adoption and upcoming Medicare initiatives expected to broaden patient access later this year, Lilly continues to demonstrate why we view it as a long-term leader in global healthcare innovation.
Source: Optimize Asset Management (May 7, 2026)
The Communication Services sector led our performance last week; nearly all our holdings posted strong gains as investors rewarded platform businesses with scalable AI exposure and recurring digital revenue. Alphabet surged nearly 14%, while Meta, Netflix, and Spotify also delivered impressive returns, reflecting renewed confidence in digital advertising and subscription growth. Our communication services holdings combine dominant platform scale, substantial free cash flow, and direct exposure to the same AI infrastructure trends powering broader market gains, making them durable long-term holdings for our portfolios.
Source: Optimize Asset Management (May 7, 2026)
Our Size strategy was once again the week's strongest performer, with mega-cap holdings like Alphabet, Apple, Tesla, Eli Lilly, and Caterpillar driving meaningful contributions to portfolio returns. During periods of macro uncertainty, investors naturally gravitate toward the largest, most established companies because of their financial strength, global reach, and resources to invest in transformative technologies in ways smaller competitors simply cannot match. Looking ahead, we expect this strategy to remain well-supported as scale itself has become a competitive advantage in today's economy, which is why we emphasize quality leaders across our portfolios.
Source: Optimize Asset Management (May 7, 2026)
We also look ahead to the economic reports, events, and earnings that may influence the week ahead. From inflation and jobs data to corporate updates from key market players, this section keeps you informed on what's coming and why it matters.
Tuesday's consumer price report gives us our broadest look at inflation trends, including everything from groceries to housing to energy. Headline inflation has temporarily moved higher to 3.3% due to energy price spikes tied to Middle East tensions; however, food inflation has eased, and shelter costs are stabilizing, both constructive signs for the bigger picture. For our portfolios, easing pressure in core categories supports our view that the Fed has flexibility to maintain a balanced policy approach over time.
Source: U.S. Bureau of Labor Statistics (May 7, 2026)
Released alongside the headline CPI, the core inflation reading strips out volatile food and energy prices to give us the clearest view of underlying price trends. The encouraging news is that core inflation has remained well-behaved at 2.6% annually, with monthly gains holding at a moderate 0.2% and used vehicle prices continuing to decline. Steady core inflation is a positive backdrop for both quality equities and bonds, reinforcing the constructive environment we see for diversified portfolios.
Source: U.S. Bureau of Labor Statistics (May 7, 2026)
Thursday's retail sales report continues to be one of our most important real-time indicators of consumer health, and recent data has been outstanding. March's report showed retail sales jumping 1.7%, the strongest pace in a year, with broad-based spending across motor vehicles, furniture, electronics, and online retailers. Strong consumer activity supports corporate earnings and reinforces our positioning in quality companies with pricing power and lasting competitive advantages.
Sources: Bloomberg (May 7, 2026), Optimize Asset Management (May 7, 2026), the U.S. Bureau of Labor Statistics (May 7, 2026), and the U.S. Census Bureau (May 7, 2026).
Disclaimer: This report is for informational purposes only and does not constitute investment advice. Please consult with your financial advisor before making any investment decisions.