NEW YORK (AP) – Wall Street concluded its triumphant week and month on a quiet Friday after a round of profit announcements from various companies dealing with challenges from GAP, Ulta Beauty, and others, influenced by President Donald Trump's On and Off Tariff.
The S&P 500 ended the day nearly flat, dipping less than 0.1%. The Dow Jones Industrial Average added 54 points (0.1%), while the Nasdaq Composite saw a decrease of 0.3%.
GAP faced significant pressure in the market even as retailers revealed profits and revenues during the most recent quarter that surpassed analyst expectations.
The parent company of Banana Republic and former Navy posted a 20.2% drop after announcing that tariffs on imports from China and other countries could incur costs up to $300 million this year. A strategy is in place to alleviate half of those costs before reaching profitability.
AP Audio: Wall Street glides to the end of its best month since 2023
Associated Press report by Seth Sutel indicates that the market concluded May on a positive note.
This week on Wall Street has been dominated by concerns regarding the future of Trump’s tariffs. Investors fear an economic recession, which could reduce profits for businesses and heighten challenges for households already grappling with inflation.
The anxiety surrounding these issues has somewhat lessened after Trump suspended tariffs on both China and the European Union. Additionally, a U.S. court’s recent ruling blocked many of the sweeping tariffs. This contributed to the S&P 500’s performance in May, marking its first successful month with four gains, the best since November.
However, while the White House is appealing the decision by the U.S. International Trade Court, tariffs remain in place for now, leaving the ultimate outcome still in question.
Just before Wall Street opened for Friday’s trading, Trump made a statement that briefly unsettled the market.
“That’s all I’m going to be, Mr. Nice Guy!” Trump posted on his Truth Social platform.
Despite this, the impact was limited, and futures for U.S. stock indexes quickly recovered from their losses. Analysts and investors have suggested that Trump and his administration are likely to seek a new approach to impose tariffs on trading partners.
Trump asserts that he employs tariffs to bring manufacturing jobs back to the U.S., although American households and businesses may face some discomfort during the process.
Among the biggest losses on Friday were notable tech stocks, with Nvidia dropping 2.9% after exceeding profit expectations for the most recent quarter, contributing significantly to the S&P 500’s decline.
On the winning side, Ulta Beauty saw an increase of 11.8% as retailers reported stronger sales and profits than anticipated. The company also raised its revenue forecast for this fiscal year, even as CEO Kecia Steelman described the operating environment as “fluid.”
Costco climbed 3.1% after its results met historical analyst expectations. Red Robin Gourmet Burger surged 62.9% after reporting profits that defied analysts’ predictions of losses.
Shares of Sharplink Gaming fell 3.2%, reducing its weekly gain to 1,041.4%, after the marketing company announced plans to raise $425 million to invest in cryptocurrency on the Ethereum blockchain. Associated with U.S. sportsbooks and global casino firms, the company is expanding into the crypto gaming market.
The S&P 500 dipped to 5,911.69 points, down 0.48. The Dow Jones Industrial Average rose to 42,270.07, an increase of 54.34, while the Nasdaq Composite fell to 19,113.77, down 62.11.
In the bond market, Treasury yields eased after a report indicated that the inflation scale utilized by the Federal Reserve was slightly lower in April than economists had anticipated.
Another report from the University of Michigan revealed that consumer sentiment in the U.S. improved in May, surpassing economists’ predictions. Sentiment rebounded after Trump suspended several tariffs on China.
“Overall, consumers view the economic outlook as significantly worse than last month, but they hold considerable concerns for the future,” remarked consumer analyst Joan Huss.
The 10-year Treasury yield relaxed from 4.43% to 4.39% in the latter part of Thursday. The two-year Treasury yield dipped from 3.92% to 3.90%, closely aligning with expectations for Federal Reserve action on overnight interest rates.
The Fed has maintained its benchmark borrowing rate thus far this year after cutting it at the end of 2024, allowing the economy some breathing space. Officials indicate a desire to wait longer before making any further moves, assessing the impact of tariffs on inflation and the economy. Low interest rates could stimulate the economy but also risk increasing inflation.
International stock markets displayed mixed results, with some European indexes and Asian markets trending downward.
___
AP business writers Eurikeyama and Matt Ott contributed.
Source: apnews.com