Will AI create the world’s first trillionaire?<\/strong> Our team just released a report on a little-known company, called an “Indispensable Monopoly,” providing the critical technology Nvidia and Intel both need. <\/p>\n Continue \u00bb<\/strong><\/a> <\/p>\n<\/td>\n<\/tr>\n What’s been noteworthy about these second-term gains is that they’re occurring amid an ongoing war (as of this writing on May 12). The Iran war has had a decisive impact on energy markets<\/a> and U.S. inflation.<\/p>\n Though the president has been clear about his stance on inflation, claiming “our inflation is just short-term,” while fielding questions on the White House lawn on May 12, historical trends suggest Trump’s words may come back to haunt Wall Street.<\/p>\n The Iran war has sent U.S. inflation to a three-year high <\/p>\n Earlier this week, the U.S. Bureau of Labor Statistics reported trailing 12-month (TTM) inflation<\/a> for April of 3.8%, which is up 140 basis points in two months (i.e., since the Iran war began) and represents a three-year high.<\/p>\n Shortly after President Trump gave the order for U.S. military forces to commence operations against Iran on Feb. 28, the latter closed down the Strait of Hormuz to commercial vessels. This closure halted the flow of approximately 20% of the world’s crude oil supply (about 20 million barrels of petroleum liquids per day).<\/p>\n Unsurprisingly, energy prices have soared. West Texas Intermediate crude oil has jumped from $67 per barrel the day before the Iran war began to more than $102 per barrel, as of this writing. This has driven up fuel pump prices at the fastest pace in decades, pinching consumers’ pocketbooks and leading to a sizable increase in TTM inflation.<\/p>\n The worry for Wall Street is that we may not have seen the worst of inflation, even if Trump is successful in quickly ending the Iran war.<\/p>\n While energy supply shocks tend to hit consumers at the fuel pump within days, the adverse effects of energy supply disruptions can come in waves. For instance, we observed higher airfares impacting inflation in April.<\/p>\n History tells us that the inflationary effects of energy price shocks on businesses lag by a few months. But higher transportation and\/or production costs are invariably passed on to consumers. Once this impact begins to work its way into economic data, U.S. TTM inflation can rise even more, despite Trump’s prediction that “our inflation is just short-term.”<\/p>\n Rapidly rising inflation is particularly worrisome for a historically expensive stock market. Investors had been counting on several rate cuts in 2026-2027 to propel the Dow, S&P 500, and Nasdaq higher. But with the Iran war effectively taking these cuts off the table, an expensive stock market is exposed and vulnerable for the first time in years.<\/p>\n The velocity at which inflation is increasing might also spur the Federal Reserve to shift to a neutral or hiking bias, or even raise interest rates. This is shaping up as a potential nightmare scenario for Wall Street.<\/p>\n Should you buy stock in S&P 500 Index right now? <\/p>\n Before you buy stock in S&P 500 Index, consider this:<\/p>\n The Motley Fool Stock Advisor analyst team just identified what they believe are the\u00a010 best stocks<\/a><\/strong> for investors to buy now\u2026 and S&P 500 Index wasn\u2019t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.<\/p>\n Consider when Netflix<\/strong> made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation,\u00a0you\u2019d have $472,744<\/strong>!* Or when Nvidia<\/strong> made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you\u2019d have $1,353,500<\/strong>!*<\/p>\n Now, it\u2019s worth noting\u00a0Stock Advisor\u2019s total average return is 991% \u2014 a market-crushing outperformance compared to 207% for the S&P 500.\u00a0Don’t miss the latest top 10 list, available with\u00a0Stock Advisor, and join an investing community built by individual investors for individual investors.<\/strong><\/p>\n See the 10 stocks \u00bb<\/strong><\/a><\/p>\n *Stock Advisor returns as of May 14, 2026. <\/p>\n Sean Williams<\/a> has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy<\/a>.<\/p>\n![\"Donald](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/05\/67d1a91458b1b643871a13b6c5307ba7.jpeg\")
President Trump delivering remarks from the South Lawn of the White House. Image source: Official White House Photo by Patrick B. Ruddy. <\/p>\n<\/a> US Inflation Rate<\/a> data by YCharts<\/a>. <\/p>\n
Image source: Getty Images. A second wave of inflation can wreak havoc on a historically pricey stock market <\/p>\n