Trump, his immigration and economic policies, and tariffs. The market appears to have absorbed a significant percentage of the unfavorable sentiments projected in February and March.
S&P 500 and Dow-30 indices are back to where they were in January. Uncertainty about trade policy has roiled financial markets in recent months, though the stock market has largely recovered from its early-April tariff-related swoon as Trump has appeared to soften his stance.
The benchmark S&P 500 index and the tech-heavy Nasdaq Composite are poised to post their biggest monthly gains since November 2023.
Investors are monitoring legal wrangling over the Trump administration’s tariff policy. Meanwhile, the good news comes from the technology sector that rallied following a strong earnings report from AI chipmaker Nvidia.
Nvidia shares rose more than 3% on Thursday, after hitting their highest level in three months and briefly putting the chipmaker back to the top of the list of the world’s most valuable companies.
Tariffs still rule the roost, and uncertainty prevails in the market. Market participants are closely tracking developments on the trade front after a federal court late Wednesday said that President Donald Trump had overstepped his authority by invoking the International Emergency Economic Powers Act to impose massive tariffs on leading U.S. trade partners.
An appeals court then temporarily paused the trade court’s ruling that had voided most of the tariffs.
The yield on the 10-year Treasury note, which affects borrowing costs on all sorts of consumer and corporate loans, is around 4.43%.
The yield moved as high as 4.63% last week, its highest level in more than three months, amid rising concerns about the federal deficit as the GOP tax and spending bill moved through Congress.
The U.S. dollar index, which measures the performance of the dollar against a basket of foreign currencies, is below 100.
The Federal Reserve chair, Jerome Powell, met with President Donald Trump one-on-one for the first time since the start of his first term in office. Trump has criticized Powell for failing to lower interest rates. Since taking office in January, Trump has been criticizing Powell and pressuring him to cut rates.
At the President’s invitation, Chair Powell met with him at the White House on May 29 to discuss economic developments, specifically growth, employment, and inflation.
The labor market appears to be deteriorating as weekly unemployment claims increased to 240,000 and continuing claims to their highest level since 2021. According to updated government figures, the US economy contracted for the first time since 2022 in the first quarter of 2025, with an annualized rate of 0.2 percent.
The one bright spot is that the unemployment rate for April remained at 4.2%, suggesting that the labor market is largely stable. However, a spike in recurrent unemployment claims is a hint that the US may soon see greater unemployment rates.
Since there is still ambiguity surrounding tariffs, markets generally anticipate that the Fed will maintain its rate policy until further information is available. According to futures market pricing, the central bank is unlikely to make another cut before the year ends and won’t start cutting again until at least September, avoiding meetings in June and July. In late 2024, the FOMC reduced rates by a full percentage point.
US stock futures moved lower on Friday as investors awaited the next PCE price index report, the Federal Reserve’s favored measure of inflation.