Two themes developed with fresh economic data released last week. First, June inflation data painted a mixed picture. The second theme revolved around consumers, who continued to be a source of strength for the economy.
Gerry Sparrow
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Trade developments and continued momentum pushed all three major averages to modest gains again for a shortened holiday trading week. So while there is good news overall, uncertainty still lingers beneath the employment surface.
Stocks fell last week as an up-and-down mix of trade progress and anxiety, economic news, and geopolitical tensions netted out. Beginning Friday morning, all three averages were under pressure all day following news of an escalated conflict in the Middle East. Oil prices pushed higher on Friday on supply concerns.
Early in the week, markets notched steady gains as investors awaited key economic indicators and monitored ongoing trade discussions. Megacap tech names—particularly AI chipmakers—led the broader market higher, as sentiment stayed bullish on prospects for a U.S.-China trade deal.
Stocks pushed higher on Monday as investors cheered weekend news that the US and China temporarily agreed to back off steep reciprocal tariffs
The rally accelerated on Friday as a better-than-expected April jobs report eased some concerns about the economy’s strength.
Stocks were under pressure following comments from Fed Chair Powell, who expressed concern about the ability of the Fed to balance its inflation and employment goals given the current trade situation.
Stocks ended the week with a strong gain as traders continued to focus on tariff talks while appearing to overlook upbeat news on inflation.
Stocks rallied the first half of the week as markets tried to anticipate the potential impact of tariffs previously announced by the White House. Soon after the closing bell on Wednesday, President Trump’s new tariffs surprised markets.
Amid all the market turbulence of late, the Fed was a steadying influence. Stocks notched a solid gain last week as upbeat comments from the Fed helped stocks snap their four-week losing streak.
By Tuesday's close, all three averages were down 3 percent on the week, and the S&P had given up its post-election gains. Stocks fell as tariffs affected Canada, Mexico, and China. Each country announced retaliatory tariffs of their own, further fanning inflationary fears among investors.
The week began under pressure after the White House said 25 percent tariffs on Mexico and Canada would begin after the 30-day pause ends in early March.