US Stock Markets Edge Toward Record Heights
NEW YORK (AP) – US stock markets are showing an upward trend, nearing another record high.
In afternoon trading, the S&P 500 climbed by 0.7%, just shy of the all-time peak recorded in February. The Dow Jones industrial average was up 349 points, or 0.8%, while the Nasdaq composite also rose by 0.8% as of 1:05 PM ET.
Leading the charge was McCormick, a seller of spices, which saw its stock jump 5% following a profit report that surpassed expectations. The company’s forecasts for the fiscal year also exceeded analyst predictions, despite ongoing concerns about tariffs proposed by President Donald Trump.
Long-term, a significant technology stock has been driving the market in recent years. There was a noticeable dip of about 20% earlier due to tariff-related anxieties.
Nvidia, a major player in the AI sector, increased by 0.8%. It’s currently the most valuable company in the US stock market, having surged 61% since reaching its lowest point on April 8. Another AI-focused firm, Super Microcomputer, rose 5.3%, boosting its profits by over 50% since that date.
Micron Technology, known for its memory and data storage products, reported better-than-expected profits and revenue for the latest quarter. CEO Sanjay Mehrotra mentioned a growing demand for AI-driven memory, and the company’s profit forecasts for the current quarter also exceeded analyst expectations. However, their inventory saw a slight decrease of 1.8% recently.
Concerns over Trump’s tariffs have lingered since the president’s surprising announcement in April, but the situation remains uncertain. It’s unclear how much the tariffs will ultimately increase, how they will impact the economy, or the extent to which they will affect inflation.
Current economic indicators suggest stability, but additional reports are due Thursday. Orders for washing machines and other manufactured goods have surpassed what economists anticipated, marking an uptick unseen in at least three years. Furthermore, fewer US workers applied for unemployment benefits last week, hinting at potential reductions in layoffs.
However, preliminary estimates indicate that the US economy shrank more than previously thought for the first quarter of 2025. Many economists believe these figures were skewed by companies rushing to purchase foreign products before tariffs came into effect, with hopes for improved results in the coming months.
After the latest report, Treasury yields fluctuated a bit in the bond market but ultimately remained stable. Yields decreased from 4.29% to 4.27% in the latter part of Wednesday. Short-term financial yields, closely tied to expectations of Federal Reserve actions, stabilized at 3.74%.
Analysts suggest yield pressures might arise from reports indicating that Trump could soon name a candidate to replace Fed Chairman Jerome Powell, potentially undermining investor confidence in the Fed’s willingness to make tough decisions about inflation management.
Powell has indicated recently that the Fed is monitoring how tariffs will affect the economy before deciding when to resume rate cuts. The Fed has paused such cuts this year as lower rates could stimulate the economy but also raise inflation.
Yet, Trump has continuously criticized Powell for not cutting rates more aggressively. His recent appointees have also suggested they would contemplate cutting rates in the next meeting, which is set for about a month from now.
“This could imply falling yields, a weakened dollar, rising bond prices, and potential negative effects on inflation,” noted Brian Jacobsen, chief economist at Annex Wealth Management. Still, he emphasized that decisions on interest rates would rest with the chairman and the committee, and other officials could adjust leadership as necessary.
In the international market, stock indexes in Europe were mixed following a varied performance in Asia. Japan’s Nikkei 225 saw a 1.6% increase, while South Korea’s Kospi declined by 0.9% amid significant market shifts.
In oil markets, prices have experienced a slight rebound following an earlier slump this week. The US crude oil benchmark rose by 1.8% to $66.09, though it remains lower than prices at the onset of the conflict between Israel and Iran.
