May trading continued higher as technology stocks led the way. Will markets continue to price in future uncertainty?
Monday
S&P 500 0.41% | NASDAQ 0.19%
Equities started the week pulling back from peak levels set last Friday. Oil prices followed similar trends after a vessel was struck in the Strait of Hormuz. Tensions have escalated leading to day-to-day disruptions, once again, in energy outlook.
Tuesday
S&P 500 0.81% | NASDAQ 1.03%
Losses from Monday were recovered with the help of gains by Intel (INTC). New home sales, JOLTS Jop Openings, and GDP Forecasts all contributed to positive sentiment. The Nasdaq and S&P500 closed at all-time highs on the back of tech.
Wednesday
S&P 500 1.46%| NASDAQ 2.02%
More gains from semiconductor companies sent indexes further in record territory. Oil prices fell closer to $100/barrel as a structure for a deal in Iran could be agreed upon soon. 10-year treasury yields fell on optimism around a deal which dropped from the spike earlier this week.
Thursday
S&P 500 0.38% | NASDAQ 0.13%
Thursday was highlighted by new jobless claims, and they proved to be positive. Markets let off the accelerator and pared mid-week gains. Trading for the first full week of May has shown resilient across most sectors.
Friday
S&P 500 0.84% | NASDAQ 1.71%
Payroll data was released on Friday (almost double expectations), and markets reacted in celebratory fashion. In a week filled with surges in chip stocks there was a watchful eye on energy markets. A response to a U.S. proposal in Iran was looming ahead of the weekend.
Conclusion
S&P 500 2.33% | NASDAQ 4.51%
Markets set fresh records on the week, and volatility metrics have been tamed so far in May. Growth has taken the lead, almost doubling value stocks in the past week. All but 2 sectors have been positive YTD. Optimism has built as earnings were announced for big chip developers showing a resilient demand for infrastructure. Positive jobs reports also boosted sentiment. Next week will show where the Consumer Price Index fell in the month of April as well as year-over-year inflation. The Federal Reserve will have to navigate a higher inflation environment with strong job growth. This will ultimately leave rates unchanged for the foreseeable future.
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