US markets rally on Friday: S&P 500 gains 2.1%, Nasdaq Composite rises 2.6%
The US stock market ended the week on a high note, as if the recent turbulence never happened. The S&P 500 climbed by 2.1% to 5,638 points, while the Nasdaq rose by 2.6%, and the Dow Jones gained 1.7% (674 points), recovering from recent losses. The rally was fueled by the classic "buy-the-dip" strategy, along with a few positive political signals. Surprisingly, a productive meeting between Ontario Premier Doug Ford and US Trade Minister Lighthizer helped ease trade tensions between the US and Canada.
But the real stars of the session were mega-cap stocks. NVIDIA ($121.67, +5.3%) and Tesla ($249.98, +3.9%) led the way, while Ulta Beauty (+13.7%) and DocuSign (+14.8%) soared despite weak guidance.
Not everything is looking bright, though: the University of Michigan's Consumer Sentiment Index plunged to 57.9 (down from 79.4 a year ago), signaling that Americans aren't sharing Wall Street's optimism. Meanwhile, demand for gold tells a different story—the metal broke above $3,001 per ounce, while the 10-year Treasury yield rose to 4.31%. More details here.
S&P 500 enters correction, shedding 10% from its record high. Prolonged consolidation ahead?
The S&P 500 is officially in correction territory, dropping 10% from its historical peak in just 16 trading sessions. If history is any guide, in the past 24 instances when the index fell 10% but avoided a bear market, it took an average of eight months to recover. This suggests that even in the best-case scenario, a return to record highs is unlikely before mid-October.
Instead of tactical tariffs, investors now expect aggressive protectionism and efforts to revitalize US manufacturing. This uncertainty is rattling markets, leading some investors to exit risk assets altogether.
Financial counsellors are advising clients to sell stocks. So, for the first time in a long while, bearish sentiment has overtaken bullish sentiment. However, history suggests that such moments often present the best buying opportunities.
According to a Harvard study, if the S&P 500 plunges by 20% in 2025, it could shave 1 percentage point off GDP growth. With the wealthiest 10% of Americans controlling half of consumer spending, a market selloff would likely lead to reduced spending, delivering a blow to the broader US economy. More details here.
Fed meeting sparks rate cut speculation as S&P 500 suffers 10% drop
The key drivers of market uncertainty today are Donald Trump's indecision on tariffs and the upcoming Fed meeting. Investors are eagerly awaiting any hint from the Federal Reserve regarding potential rate cuts—even a subtle signal could help calm a market that is experiencing one of its most difficult periods this year.
The concerns are justified: on Thursday, the S&P 500 officially entered correction territory, losing more than 10% from its February 19 record high, and in just one week, the market shed $4 trillion in capitalization. Even tech giants like Nvidia and Tesla didn't avoid sell-offs of their shares.
However, while investors are placing their hopes on the Fed, inflation remains a wildcard. Recent data showed some easing of price pressures, which could theoretically justify a more accommodative monetary policy. But with inflation still above the Fed's 2% target and soft macroeconomic data, the central bank is unlikely to rush into rate cuts.
To sum up, if the economic data continues to disappoint, the Fed may have no choice but to ease policy. More details here.
US stock market remains under pressure as S&P 500 and Nasdaq 100 futures decline amid economic policy concerns
US stock futures dipped again after Treasury Secretary Scott Bessent suggested that the recent market downturn was actually "a good thing." This upbeat attitude toward the $5 trillion decline in S&P 500 capitalization quickly dashed investors' hopes that Trump's administration would step in to stabilize markets. As a result, S&P 500 and Nasdaq 100 futures dropped another 0.6%, adding to market anxiety ahead of a crucial week of central bank meetings.
Meanwhile, European stock markets are trading steadily: the Stoxx 600 index was mostly unchanged. But Asia is celebrating, with a resurgence in Chinese consumer spending boosting regional markets.
On Wall Street, however, there is nothing to celebrate. Many investors had hoped that Bessent would serve as a moderating influence within the Trump administration, pushing back against aggressive tariff policies. But after his latest remarks, it's clear that the administration is in no hurry to rescue the markets.
While stock investors are taking profits and shifting to safe-haven assets, oil prices are rising. China has pledged new stimulus measures to boost domestic consumption. Meanwhile, the US is signaling additional strikes against Houthi forces in Yemen.
Looking ahead, central bank meetings are in focus: while the Bank of Japan and the Bank of England are expected to hold rates steady, the Fed will likely try to reassure markets that it has everything under control. More details here.
Baidu unveils new AI models, challenging market leaders like OpenAI
The US stock market is losing trillions, and oil prices are surging—while investors scramble to find an edge, Chinese tech giant Baidu is making moves.
On Sunday, Baidu unveiled Ernie X1, an AI model poised to rival ChatGPT and DeepSeek. And this is not just another AI release—it's a direct challenge to the industry's balance of power.
Baidu is betting on enhanced algorithms, high performance, and, most importantly, free access. Starting June 30, developers will be able to use Ernie AI with no restrictions, adapting it to their needs.
Meanwhile, oil remains a hot topic:
- Brent crude futures rose 1% to $71.33 per barrel.
- WTI crude climbed to $67.94 per barrel.
The price surge was driven by talks of new stimulus for China's economy and ongoing tensions in the Middle East. Traders are positioning for volatility, while investors closely monitor the trends.
How long will this rally last? The coming weeks will reveal the answer, but one thing is clear—the world is on the brink of major changes, and those who read the market correctly will seize the biggest opportunities. More details here.
Volatility persists in US stock markets
The US stock market opened the week in a wait-and-see mode, searching for direction after four consecutive weeks of declines. The S&P 500 and Nasdaq fell 2.3% and 2.4%, respectively. The Dow dropped 3.1%, marking its worst performance since 2023.
Technically, the S&P 500 is at a crucial juncture, hovering near 5,600 points, after testing 5,504 last week. Investors are now speculating whether the market will drop to 5,250 or rebound toward 6,260. Meanwhile, Nvidia continues to thrive despite market chaos:
- Revenue surged 78% to $39.3 billion this quarter.
- Data center segment revenue nearly doubled to $35.6 billion.
- The new Blackwell GPU generated $11 billion in sales.
CEO Jensen Huang has yet to address concerns about a potential slowdown in AI demand, but his upcoming speech at the GTC conference could be pivotal for Nvidia's stock performance. More details here.
