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Fidelity: Retirement Savers Survived The Volatility Test
Plus, the latest in market news.
Happy Sunday, and welcome to Benzinga’s financial advisor newsletter.
We’re back discussing retirement savings. Fidelity’s Q1 2026 retirement analysis — which has data from nearly 55 million retirement accounts — reveals both encouraging and concerning trends. While account balances declined during the quarter, retirement savers responded exactly the way financial advisors hope they would. Read below for all the details.
Plus, a look at all the top stories and market activity from this past week.
Advisor Spotlight: If you would like your company to be featured in our upcoming Advisor Spotlight, click here to send us an email. And in case you missed it, here’s this month’s feature.
INDUSTRY CHATTER
The first quarter gave investors plenty of reasons to second-guess their retirement plans. Market volatility returned, headlines dominated the news cycle, and uncertainty remained high with the war in Iran. Yet Fidelity's latest retirement analysis shows most retirement savers did exactly what advisors hope they would: they stayed the course.
That discipline showed up in several ways. Both 401(k) and 403(b) total savings rates reached new records with 14.4% for 401(k) savers, and 12% for 403(b) participants. While still behind Fidelity's recommended 15% savings target, participants keep inching closer. IRA contributions also surged, climbing 29% from a year ago, while the number of account holders contributing to their IRAs increased 28%. Rather than pulling back during uncertain markets, many investors leaned in and continued prioritizing their long-term goals.
Perhaps even more telling was what investors didn't do. Only 5% of retirement plan participants changed their asset allocation during the quarter, a slight decline from a year ago, suggesting most resisted the temptation to react to short-term market swings. When it comes to generations, Gen Z is also leading the way for IRA growth (65% year-over-year), followed by Millennials with a 31% increase.
While market volatility led to modest declines in account balances across the board from the previous quarter, the long-term picture remains encouraging. Average 401(k) balances were still up 11% from a year ago, while 403(b) balances rose 13% and IRA balances increased 7%. It's a reminder that short-term fluctuations often look much smaller when viewed long-term.
Another trend continues to gain momentum: Roth adoption. Two-thirds of all IRA contributions went into Roth accounts during the quarter, while Roth conversion activity jumped 41% year over year. As tax planning becomes an increasingly important part of retirement advice, these conversations are likely to remain front and center for many clients.
For advisors, the message is both encouraging and instructive. Clients don't need perfect markets to make meaningful progress towards retirement. They need consistent saving habits, thoughtful planning, and the confidence to stay invested when volatility and uncertainty comes along. Markets will always test investor confidence, but advisors play a critical role in making sure short-term uncertainty doesn't derail long-term progress.
WEEKLY MARKET RECAP
Two of America’s largest companies reported earnings this week. Neither was punished for what it sold.
Both were punished for what they spent.
Alphabet (GOOGL) lost $294 billion in market value on Thursday, the largest single-session loss in the company’s history.
Tesla (TSLA) suffered its worst week since March 2020. Underneath both selloffs sat the same line item: CAPEX.
Above it all, Brent crude climbed above $100 a barrel for the first time since May.
Why Did Oil Reclaim $100?
After Iran-backed Houthi forces attacked Saudi oil tankers in the Red Sea, President Donald Trump told Axios he was weighing a “massive attack” against Iran.
The markets reacted. The two-year Treasury yield, the bond market’s cleanest read on where investors think the Federal Reserve is headed, rose to 4.35% — its highest level since February 2025.
Traders now price two Fed rate hikes over the next year.
There is even a 35% probability attached to a hike at next week’s Federal Open Market Committee meeting, the gathering that sets U.S. interest rates.
The inflation trade is back.
Chart: Crude Broke Above $100, Before Slipping On Friday
What Spooked Alphabet’s Investors?
Alphabet reminded Wall Street that AI leadership arrives with an invoice.
Second-quarter capital expenditures reached $44.9 billion, double the level of a year earlier. Management lifted full-year spending guidance to $195 billion–$205 billion and signaled another increase in 2027.
Free cash flow, the money left over once a company has paid its bills and built its infrastructure, swung to a record negative $5.9 billion.
Shares fell 7.1%, the worst session since May 2025.
Chart: Alphabet’s Free Cash Flows Went Negative For First Time In Company’s History
Tesla’s Bill Was Even Harder To Read
Tesla dropped nearly 19% for the week after adjusted earnings of 33 cents a share missed the 53-cent consensus and operating margin collapsed to 1.4%.
Capital expenditures jumped 142% year over year to $5.8 billion, tied largely to AI, robotics and autonomous driving, pushing free cash flow $1.1 billion below zero.
Chart: Tesla Suffered Worst Week Since March 2020
Where Did The Money Go Instead?
Into weapons. Lockheed Martin (LMT) rose 10.6% on a record $230.4 billion backlog, supported by a $35 billion THAAD contract and surging missile demand. RTX (RTX) gained 7.7% after another beat-and-raise quarter. Both are positioned for higher U.S. defense budgets.
Detroit joined in. General Motors (GM) climbed roughly 10% after its 16th consecutive earnings beat and an upgraded full-year outlook.
The Streaks Beneath The Surface
Energy did the quiet work.
Chevron (CVX), ConocoPhillips (COP) and EOG Resources (EOG) each closed higher for a seventh straight session, the longest active winning streaks in the S&P 500, amid soaring crude prices.
The pain at the pump is the payday in Houston.
Meta (META) moved the other way, falling for a seventh consecutive session, the longest active losing streak in the index. Investors are applying the Alphabet lens to every hyperscaler that has promised to spend more.
Banks quietly ran the tape. Bank of America (BAC) and JPMorgan Chase (JPM) each closed an eighth straight winning week, the longest run for Bank of America since 2021 and for JPMorgan since 2024.
Higher yields for longer widen what lenders earn on their loan books.
What’s Next?
Four of the Magnificent Seven — Apple (AAPL), Microsoft (MSFT), Amazon (AMZN) and Meta — report earnings between Tuesday, July 27 and Thursday, July 30.
In between sits what is shaping up to be one of the most uncertain Federal Reserve meetings in years.
The ingredients for another volatile week are there.
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THE WEEK AHEAD
Economic Data
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Tuesday: Retail inventories, Consumer confidence, Home price index
Wednesday: Crude oil inventories, Fed interest rate decision
Thursday: Personal income, Initial jobless claims GDP, PCE,
Friday: Oil rig count, Consumer sentiment, Inflation expectations
Earnings
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