Stock Market Impact: U.S. equities closed higher on Friday. The S&P 500 rose 0.6% to 7,489.68, the Nasdaq Composite gained 0.6% to 26,460.10, and the Dow Jones Industrial Average added 0.8% to 50,665.22, putting the market on track for an eight‑week winning streak—the longest since December 2023. The rally was supported by falling Treasury yields and easing oil prices.
Bond and Rate Environment: After an early‑week surge, the 10‑year U.S. Treasury yield retreated from a one‑year high and the 30‑year yield fell from its highest level since 2007. The bond sell‑off had been driven by expectations of further global central‑bank rate hikes to combat inflationary pressure from surging oil prices linked to the Iran‑related conflict. Federal Reserve minutes indicated a majority view that a 25‑basis‑point hike could be appropriate if energy‑driven inflation persists; a rate hike is now fully priced in for the year.
Listed Companies and Sectors: Nvidia reported quarterly results that comfortably beat top‑ and bottom‑line expectations and issued revenue guidance above analyst estimates, citing strong demand for premium AI chips. Take‑Two Interactive posted quarterly net bookings that beat forecasts and reaffirmed a November 19 release date for Grand Theft Auto VI, with CEO Strauss Zelnick projecting record operating performance for fiscal 2027. Workday’s Class A shares rose 3.9% after first‑quarter results topped expectations and guidance was viewed as upbeat. Zoom Communications surged nearly 12% on strong earnings and guidance. Estée Lauder’s stock jumped 10.5% after the company and Spanish beauty brand Puig terminated discussions on a potential merger.
Middle‑East Developments: Iranian state media reported that 35 merchant vessels, including oil tankers and container ships, safely transited the Strait of Hormuz under IRGC escort, indicating a de‑escalation of the waterway blockage that had previously driven oil prices higher. U.S. Secretary of State Marco Rubio noted “good signs” in peace talks, while Pakistan’s Interior Minister Syed Mohsin Naqvi acted as a mediator, suggesting progress toward ending hostilities.
Commodity and Inflation Context: Brent crude futures were up 1.5% at $104.11 per barrel but were on track for a weekly decline of nearly 5%. The University of Michigan’s final consumer sentiment index for May fell to a record low of 44.8, down from 49.8 in April, with one‑year‑ahead inflation expectations rising to 4.8%.
