Stocks closed mostly higher on Friday, but all of the major indexes closed lower for the week.

Rising tensions in the Middle East, which in turn have lifted oil prices, is keeping inflation concerns top of mind.

Even though recent inflation reports have shown inflation pressures easing, especially structural inflation -- if crude prices continue to climb, it's likely to keep inflation stubbornly high, or worse, start to climb.

We'll get another look at inflation this week (Wednesday, 8/26) with the Personal Consumption Expenditures (PCE) index, which is the Fed's preferred inflation gauge. Last month's report saw headline inflation ease to 3.7% vs. the previous month's 4.1% pace, with the core rate (ex-food & energy) coming in at 3.3% vs. the previous month's 3.4%.

Treasury yields have been rising (2-year and 10-year hit their highest level in over a year, while the 30-year hit its highest yield in 19 years) on inflationary concerns, not to mention rising debt levels, which hit $40 trillion last week, the highest on record.

The Treasury Department announced last week they would double their buybacks on long-term debt. That did send yields lower after the announcement. But they were back on the rise shortly thereafter. The 2-year is slightly lower, but the 10-year and 30-year are higher than before the relief announcement.

Adding to concerns is the report that trade talks between the U.S. and Canada ended without a deal, and the U.S. will impose a 50% tariff on roughly $20-$28 billion of Canadian goods. That's approximately 5-7% of annualized Canadian exports to the U.S.

Canada is expected to impose retaliatory tariffs on the U.S. ("dollar for dollar") on September 8.

Although, the trade rift between the two countries could be short lived. Dominic LeBlanc, Canada's trade minister for the U.S., said last week that a deal was "very close." The U.S. is Canada's largest buyer of exports, while Canada is the U.S. second-largest buyer of exports.

Earnings season will 'officially' come to a close next week when NVIDIA reports on Wednesday, 8/26 after the close.

It's been a pretty stellar earnings season so far. With nearly 93% of the S&P 500 companies having already reported Q2 results, aggregate earnings are up 40.9% vs. this time last year, and are on pace to be up 43.4% by the time earnings season is over.

Despite last week's decline, the major indexes are within just a few percent (or less) of their all-time highs.

And I'm expecting a lot more upside to go within the remaining 4+ months of the year.

See you tomorrow,