US Stocks Surge Higher to Close Out the Week – Nasdaq Up 1.6%
US stock indices finished the week on a positive note after inflation numbers came in as expected and President Trump and Zelenskiy clashed in a White House meeting. All three major indices finished the day up, with the Dow adding 1.39%, the S&P 1.59%, and the Nasdaq closing up 1.63%.
Treasury yields dipped to fresh multi-month lows as uncertainty concerns increased, with the 2-year notably dipping beneath the 4% level, closing down 8.5 basis points at 3.989%, and the 10-year off 7.2 basis points to 4.208%. The dollar pushed higher again, with the DXY adding another 0.34% to move up to 107.61 on the close.
Oil prices dropped, marking their first monthly loss since November, with Brent down 1.03% to $72.81 and WTI down 0.84% to $69.76. Meanwhile, gold fell further in response to the stronger dollar, losing 0.66% on the day to finish the week at $2,858.60.
US Data in Focus This Week
It is a big week ahead for US data, with investors focusing strongly on a raft of fundamental updates, culminating in the Non-Farm Payrolls on Friday. US data has shown strong signs of a turn in the last couple of weeks, and if this week’s numbers indicate a further slowdown in the economy, markets are expected to react accordingly.
US stocks had a strong close on Friday despite the increased uncertainty created by the White House clash. However, treasury yields dropped sharply, and the dollar gained ground on haven buying. Jobs data will be a major focus, with the ADP and weekly unemployment claims reports leading up to the NFP release. If signs of a slowing labor market emerge, Fed rate cut expectations could gain traction. This would raise the question of whether stocks can rally on potential rate cuts or decline further due to weakening fundamentals. Most traders expect a volatile week ahead, regardless of how the numbers unfold.
Busy Day to Start a Big Calendar Week
Traders anticipate heightened volatility in the week ahead, with a full macroeconomic event calendar, central bank updates, and geopolitical factors keeping them on their toes through to Friday’s close.
The first session of the day is relatively quiet, but things pick up later, with the EU CPI data due in the early London session, where a 2.5% increase is expected for the Core CPI, ahead of Thursday’s ECB rate decision.
Shortly after the New York open, the first major US data release of the week arrives with the Final Manufacturing PMI, followed by the more impactful ISM Manufacturing PMI (expected at 50.6) and the ISM Manufacturing Prices Index (expected at 56.2).
