Wall Street Closes Month with Market Gains
Wall Street continued its upward momentum Friday. Major stock indexes extended the market’s recent success and ended the month with solid gains. The S&P 500 increased by 0.2%, marking its seventh consecutive gain and ninth straight winning week. This was the longest streak since 2023, with the index reaching an all-time high for the fourth straight day.
The Dow Jones Industrial Average saw a rise of 0.7%, while the Nasdaq composite added 0.2%. Both indexes reached new heights after setting records earlier in the week. Significant increases in tech stock values have largely fueled this streak. During May, technology stocks within the S&P 500 grew by over 15%, while most other sectors lost ground.
“The rally has been largely tech-led and supported by resilient earnings, but the key question is whether it can be sustained,” commented Angelo Kourkafas, senior global strategist at Edward Jones.
Tech stocks drove the market higher Friday as well. Microsoft rose 5.4%, and Broadcom gained 4.7%. Another standout was Dell Technologies, surging 32.8% after reporting profits that exceeded expectations and increasing its outlook, attributing it to a strong demand for AI computing.
Conversely, sectors like media and retail declined. Paramount Skydance fell 1.9%, Amazon.com dropped by 1.2%, and Costco Wholesale fell by 3.9%.
Despite concerns about the U.S. war with Iran impacting inflation and economic growth, Wall Street continues to gain. A potential deal to extend a ceasefire between the U.S. and Iran has alleviated some pressure on oil prices.
The price of Brent crude for August delivery decreased by 1.7% to settle at $91.12 per barrel, a significant drop from prices before the conflict began. U.S. crude oil for July delivery also decreased by 1.7% to settle at $87.36 per barrel. Treasury yields held mostly steady, the yield on the 10-year Treasury slightly decreased to 4.44%.
Higher oil prices remain a pressing concern. The war has affected oil shipments through the Strait of Hormuz, a critical passage for global energy resources, inflating gasoline prices and a wide range of goods.
Recent reports emphasized inflation’s growing influence on consumers. A preferred inflation measure by the Federal Reserve showed acceleration in April, reaching a three-year high. Meanwhile, consumer confidence has been dipping due to inflationary pressures.
Nevertheless, strong corporate earnings have tempered some of Wall Street’s inflation worries. According to FactSet, S&P 500 companies reported an overall profit growth of 28% for the latest quarter.
Investors might refocus on inflation, consumer behavior, and the Federal Reserve’s strategies for interest rates. The Fed has maintained its benchmark rate steady while monitoring inflation trends. It is expected to continue this approach through the year. Adjusting interest rates could affect borrowing costs and the economy but might exacerbate inflation.
Despite geopolitical disruptions, stocks recorded further gains in May, with the S&P 500 ending the month with a 5.1% increase. It has risen 10.7% this year.
On Friday, the S&P 500 gained 16.43 points to reach 7,580.06. The Dow increased by 363.49 points to close at 51,032.46, and the Nasdaq rose by 55.15 points, ending at 26,972.62. Markets in Europe and Asia also showed mostly positive trends.