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Briefing.com Summary:

*Ongoing resilience on display in major equity indices.

*Renewed concerns about lasting power of U.S.-Iran ceasefire.

*Stagflation vibes in Personal Income/Outlays report for April.

This week's record run in the stock market was set to face some early resistance after overnight reports of renewed military action between the U.S. and Iran weighed down investor sentiment.

U.S. forces carried out strikes against targets in Iran, which was met with an Iranian strike on a U.S. base that launched the initial attack. The skirmish added a negative wrinkle to the overall picture, resulting in some downward pressure on equity futures and upward pressure on oil.

However, equity futures swiftly recovered their overnight losses with help from economic data that was weaker than expected, which in turn boosted the market's hopes that a potential rate hike in early 2027 could be avoided.

Personal income for April decreased slightly, resulting in an unchanged month-over-month reading (Briefing.com consensus 0.5%) after a revised 0.5% increase (from 0.6%) in March. Personal spending rose 0.5% month-over-month (Briefing.com consensus 0.4%) following a revised 1.0% increase (from 0.9%) in March.

The PCE Price Index increased 0.4% month-over-month (Briefing.com consensus 0.5%), leaving it up 3.8% yr/yr versus 3.5% in March. The core PCE Price Index rose 0.2% (Briefing.com consensus 0.3%), leaving it up 3.3% yr/yr versus 3.2% in March.

The key takeaway from the report is that the lack of income growth combined with an acceleration in the year-over-year core PCE Price Index (to 3.3% from 3.2%) will invite stagflationary concerns, especially if this dynamic continues in the following months.

Separately, the second estimate of Q1 GDP showed a downward revision to an annual rate of 1.6% (Briefing.com consensus 2.0%) from 2.0% in the advance estimate. The GDP Chain Deflator was revised down to 3.5% (Briefing.com consensus 4.5%) from 3.6% in the advance estimate.

The key takeaway from the report is that investment and consumer spending in Q1 were weaker than previously estimated while government spending and the impact of trade were essentially unchanged from the advance estimate.

Durable goods orders surged 7.9% month-over-month in April (Briefing.com consensus 1.7%) after increasing a revised 1.1% (from 0.8%) in March. Excluding transportation, orders were up 1.1% month-over-month (Briefing.com consensus 0.5%) following an upwardly revised 1.1% increase (from 0.9%) in March.

The key takeaway from the report is that a big increase in aircraft orders from Boeing (BA) fueled the headline increase while nondefense capital goods orders excluding aircraft decreased 1.1%, reflecting some newfound softness in business spending.

Initial jobless claims for the week ending May 23 increased by 5,000 to 215,000 (Briefing.com consensus 214,000) from last week's revised reading of 210,000 (from 209,000), while continuing jobless claims for the week ending May 16 rose to 1.786 million from a revised 1.771 million (from 1.782 million) in the prior week.

The key takeaway from the report is that even with this increase in initial and continuing claims, the overall level of jobless claims remains relatively low.

Treasuries started the day in negative territory due to the renewed Iran-related concerns, but they have recovered their early losses in reaction to the generally disappointing economic data. The 10-yr yield is down one basis point at 4.47% after marking a high of 4.51% at the start of today's cash session.