US stocks rebounded on Friday, May 24, after a sharp decline in the previous session, thanks to news of an improved inflation outlook, sending the Nasdaq to a record close and its fifth consecutive weekly gain.
The Dow Jones Industrial Average rose 4.33 points, or 0.011 TP3T, to 39,069.59. The S&P 500 gained 36.88 points, or 0.701 TP3T, to 5,304.72, and the Nasdaq Composite added 184.76 points, or 1.101 TP3T, to 16,920.79. Trading volume was down ahead of the upcoming Memorial Day holiday (May 27).
Despite the positive performance on May 24, the Dow Jones index ended its five-week winning streak after witnessing its biggest daily percentage drop in more than a year on May 23. For the week, the Dow Jones index fell 2.34%, the S&P 500 index rose a negligible 0.03%, and the Nasdaq Composite index rose 1.41%.
The US Commerce Department said new orders for US-made capital goods rebounded more than expected in April 2024. Meanwhile, the University of Michigan reported that US inflation expectations improved in late May 2024, after deteriorating earlier in the month.
The data was a little better than expected, which could give the Federal Reserve room to cut interest rates and the economy will be fine, said Rob Haworth, chief investment strategist at US Bank Wealth Management in Seattle.
In the first two trading sessions of this week (May 20-21), the Nasdaq index continuously set new record highs, thanks to the strong growth of technology stocks.
Fed officials said that weak inflation data and strong economic data in the first quarter of 2024 led them to conclude that “it will take longer than previously anticipated” to be confident that inflation is declining.
The market fell across the board in the following two trading sessions (May 22-23), as the minutes of the latest Fed meeting highlighted concerns about persistent price pressures in the world's largest economy.
Notably, Nvidia's stock price rose 9,32% on May 23 and closed above $1,000/share for the first time, pushing the Nasdaq and S&P 500 to record highs during the session. However, the stock market fell after economic data showed that US price pressures increased in May 2024, even as business activity accelerated and weekly jobless claims fell.
Source: Bnews
