Wall Street closed higher on Friday, securing weekly gains as investors monitored earnings reports and trade tensions between the U.S. and China. The S&P 500 and the Nasdaq benefited from rallies in the artificial intelligence-related megacap stocks known as the “magnificent seven,” while the Dow Jones Industrial Average posted more muted gains. Meanwhile, the small-cap Russell 2000 delivered its largest weekly percentage gain since November.
Highlights
S&P 500 and Nasdaq led the gains, boosted by AI-related megacaps.
Russell 2000 recorded its biggest weekly rise since November.
Dow Jones Industrial Average rose 20.10 points to 40,113.50.
Signs of U.S.-China Trade De-escalation Lift Markets
Investor sentiment improved after Beijing announced tariff exemptions on some U.S. imports, despite denying President Trump’s claims about negotiation progress. This move followed de-escalatory remarks from U.S. Treasury Secretary Scott Bessent, suggesting the two superpowers might be easing their long-running trade war that has shaken markets for weeks.
Highlights
China exempted certain U.S. imports from 125% tariffs.
U.S.-China trade tensions showed signs of easing, boosting market confidence.
Greg Bassuk described the week’s recovery as sparked by de-escalation hopes.
Corporate Earnings Season in Full Swing
As of now, 179 companies in the S&P 500 have reported first-quarter earnings, with 73% beating analyst expectations. According to LSEG, earnings are now expected to grow by 9.7% year-on-year for the January-March period, compared to the 8.0% forecast at the beginning of April. However, investors have been focusing more on forward guidance, with several companies lowering or withdrawing projections due to economic uncertainty and weak consumer spending.
Highlights
73% of S&P 500 companies have beaten earnings expectations.
Q1 earnings growth forecast now at 9.7%.
Investors are closely watching forward guidance amid economic uncertainties.
Consumer Sentiment and Inflation Concerns
The University of Michigan released its final April reading for consumer sentiment, revealing a slight upward revision but remaining at the lowest level since July 2022. Despite the minor improvement, inflation expectations stayed elevated, indicating persistent concerns among consumers about the rising cost of living.
Highlights
Consumer sentiment index for April at 52.2, lowest since July 2022.
Inflation expectations remain hot, reflecting consumer anxiety.
Market Performance Snapshot
On Friday, the major indices closed as follows:
Dow Jones Industrial Average rose 20.10 points (0.05%) to 40,113.50.
S&P 500 gained 40.44 points (0.74%) to 5,525.21.
Nasdaq Composite climbed 216.90 points (1.26%) to 17,382.94.
Among the 11 major sectors of the S&P 500, consumer discretionary and technology led the gains, while materials experienced the largest losses.
Highlights
Tech and consumer discretionary sectors outperformed.
Materials sector posted the biggest loss.
Stock-Specific Movements
Shares of Alphabet rose 1.7% after the company reported a 28% surge in Google Cloud revenue and emphasized the profitability of its AI investments. Meanwhile, Intel shares fell 6.7% after the chipmaker provided weak revenue and profit forecasts. SLB, an oilfield services provider, slipped 1.2% after missing profit expectations and warning of a potential sector-wide shift.
On the other hand, Charter Communications jumped 11.4% after beating revenue estimates and adding more subscribers than anticipated.
Highlights
Alphabet shares rose 1.7% on strong Google Cloud growth.
Intel fell 6.7% on weak forecasts.
Charter Communications surged 11.4% after subscriber beat.
Market Breadth and Volume Data
On the New York Stock Exchange (NYSE), advancing issues outnumbered decliners by a 1.33-to-1 ratio. On the Nasdaq, the ratio was 1.14-to-1 in favor of advancing issues. The S&P 500 recorded 4 new 52-week highs and 6 new lows, while the Nasdaq Composite posted 32 new highs and 47 new lows.
Total volume on U.S. exchanges was 14.30 billion shares, significantly lower than the 19.13 billion daily average over the last 20 trading days.
Highlights
Advancers outnumbered decliners on both NYSE and Nasdaq.
Volume was lower than the recent daily average.
S&P 500 and Nasdaq recorded a moderate number of new highs and lows.
