Damian Troise and Alex Veiga
Wall Street pushed further into the record books, as the major stock indexes extended the market’s recent winning streak and closed out a solid month of gains.
The S&P 500 rose 0.2 per cent, notching its seventh consecutive gain and ninth straight winning week — the longest such streak since 2023. The benchmark index set an all-time high for the fourth day in a row. The Dow Jones gained 0.7 per cent and the Nasdaq composite added 0.2 per cent. The Dow and Nasdaq also reached new heights after posting record highs earlier in the week.
The Australian sharemarket is set to slip, with futures on Saturday pointing to a los of 13 points, or 0.2 per cent, at the open. The Australian dollar was trading at US71.71¢ at 5.18am AEST.
Big technology stocks have been behind much of Wall Street’s record-breaking streak. Their pricey stock values give them more influence in directing the market higher or lower. In May alone, technology stocks within the S&P 500 rose more than 15 per cent, while most of the sectors in the benchmark index actually lost ground.
“The rally has been largely tech-led and supported by resilient earnings, but the key question is whether it can be sustained,” wrote Angelo Kourkafas, senior global strategist at Edward Jones, in a research note.
Tech stocks also powered the market higher Friday. Microsoft rose 5.4 per cent and Broadcom gained 4.7 per cent.
Dell Technologies surged 32.8 per cent to lead all stocks in the S&P 500 after delivering profits that blew past expectations. The company also raised its outlook, citing powerful demand for AI computing.
Most other sectors in the S&P 500 lost ground Friday. Among the decliners: Paramount Skydance fell 1.9 per cent, Amazon.com dropped 1.2 per cent, and Costco Wholesale closed 3.9 per cent lower.
Wall Street has been gaining ground despite worries that the U.S. war with Iran is worsening inflation and jeopardizing economic growth.
The U.S. and Iran are reportedly working toward a deal to extend a ceasefire. That eased pressure on oil prices. The price for August delivery of Brent crude, the international standard, fell 1.7 per cent to settle at $91.12 per barrel. It is still well above the $70 per barrel level in late February before the war began. The price for a barrel of benchmark U.S. crude oil for July delivery fell 1.7 per cent to settle at $87.36.
Treasury yields held relatively steady as oil prices fell. The yield on the 10-year Treasury slipped to 4.44 per cent from 4.45 per cent late Thursday.
Still, high oil prices remain a key concern for Wall Street. The war has stifled the flow of oil shipments through the Strait of Hormuz. Roughly a fifth of the world’s oil and natural gas is shipped through the waterway.
That has pushed up prices for gasoline and a wide range of goods, feeding inflation and squeezing consumers and businesses. Prices were already rising before the war began from the ongoing impact of tariffs.
Several reports this week reflected inflation’s rise and impact on consumers. A measure of inflation preferred by the Federal Reserve accelerated in April to its highest level in three years. Consumer confidence is slipping amid the squeeze from rising inflation.
Wall Street’s worries about rising inflation have been somewhat muted by the latest round of corporate profit reports. Companies in the S&P 500 have reported profit growth of 28 per cent overall for the most recent quarter, according to FactSet. The overwhelming majority of companies in the S&P 500 have already reported their latest results. That could mean investors’ focus may shift back toward inflation, consumers’ behaviour and the Fed’s path ahead for interest rates.
The Fed has been holding its benchmark interest rate steady as it closely watches rising inflation. It is expected to continue holding rates steady at its next meeting in June and through the year, according to CME’s FedWatch tool. Cutting interest rates could help lower borrowing costs and give the economy a jolt, but it could also worsen inflation at time when prices are already high and rising.
Despite the market turbulence caused by the conflict in the Middle East, stocks notched further gains in May. The S&P 500 closed out the month with a 5.1 per cent gain. It’s up 10.7 per cent so far this year.
All told, the S&P 500 rose 16.43 points to 7,580.06 on Friday. The Dow gained 363.49 points to 51,032.46, and the Nasdaq added 55.15 points to finish at 26,972.62.
Markets in Europe and Asia mostly rose.
AP
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