US Stocks Rebound Near Record Highs
US stocks rallied to record highs on Friday (May 8th) as strong earnings prospects and signs of a solid labor market offset concerns about the war in Iran. The S&P 500 and Nasdaq rose 0.5% to new highs, while the Dow Jones Industrial Average added more than 100 points.
The gains were led by infrastructure and AI-related software stocks, which continued their rally after leading gains throughout the week. Several companies in these sectors highlighted improving productivity and rising demand in their latest earnings reports, suggesting that this demand is expected to remain resilient despite macroeconomic headwinds in the US.
On the risk side, the attacks between Iran and the US dampened hopes for a deal that could restore energy supplies from the Persian Gulf. However, equity markets tend to be more responsive to the combination of corporate earnings and economic data, although rising energy prices remain a risk channel that can impact inflation and interest rate expectations.
The employment report also reinforced the view that job creation has been higher than expected for two consecutive months, providing room for hawkish FOMC members to adjust their rhetoric. With core inflation remaining high and energy prices rising, the market is once again considering the possibility of a Fed rate hike this year.
Among blue-chip stocks, Tesla and Nvidia rose more than 1%, while AMD rose 2% and is on track to gain around 15% in the week. (yds)
Source: Newsmaker.id
