[New York Stock Market] Nasdaq Rises 3.33% on Slowing Inflation Indicators... Breaks Weekly Downtrend

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Major indices of the U.S. New York stock market closed higher on Friday, the 27th (local time), as the inflation indicator preferred by the central bank, the Federal Reserve (Fed), slowed down and investor sentiment recovered.

The three major indices also broke a 7 to 8-week losing streak on a weekly basis and turned upward for the first time in a long while. This week, the S&P 500 index and the Dow Jones Industrial Average recorded their best week since November 2020.

On this day at the New York Stock Exchange (NYSE), the Dow closed at 33,212.96, up 575.77 points (1.76%) from the previous session. The large-cap-focused S&P 500 index rose 100.40 points (2.47%) to 4,158.24, and the tech-heavy Nasdaq index closed at 12,131.13, up 390.48 points (3.33%).

Investors focused on the inflation data and corporate earnings released that day. It was evaluated that confirmation of a slight easing of inflation helped lift the stock market. The core Personal Consumption Expenditures (PCE) price index for April, preferred by the Fed, rose 4.9% year-over-year, down from 5.2% the previous month.

Following cases like Walmart and Target, investors remain cautious about whether recent inflation concerns will be reflected in corporate earnings. On this day, apparel company Gap lowered its annual net profit forecast and saw a sharp intraday decline. However, based on the closing price, it rose 4.32% compared to the previous session.

Ulta Beauty closed up 12.47% after releasing earnings that exceeded market expectations. Discount retailer Costco rose only 1.24% despite better-than-expected sales.

Tech stocks also showed strength. Software company Autodesk rose 10.31% on strong earnings. Dell Technologies increased 12.86%, and Marvell rose 6.72%. Leading tech stock Tesla surged 7.33%. Nvidia (+5.38%), Amazon (+3.66%), Apple (+5.86%), and Meta (+1.83%) also jumped together.

Tom Martin, Senior Portfolio Manager at Global Investment, said, "We are catching our breath here," adding, "We came down quite quickly, and if we enter a stable zone here, the decline we have confirmed so far may be all or nearly all that was necessary."

On a weekly basis, the New York stock market continued its rally through Friday and closed the week higher. The Dow rose 6.2%. The S&P 500 and Nasdaq indices soared 5.6% and 6.2%, respectively. Economic media CNBC reported, "Much of this week's gains appeared on Thursday and Friday," noting that "strong retail earnings and inflation data boosted investor sentiment." Until last week, the Dow had fallen for eight consecutive weeks, and the S&P 500 and Nasdaq had declined for seven consecutive weeks.

On this day, the Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as Wall Street's 'fear gauge,' fell more than 6% to the 25 level compared to the previous session.

However, despite this rally, market caution remains. The Nasdaq index is still in a bear market, about 20% below its peak.

In the New York bond market, the yield on the U.S. 10-year Treasury note fell slightly to 2.74%.

Oil prices rose as demand was expected to increase. On the New York Mercantile Exchange, July West Texas Intermediate (WTI) crude oil prices closed at $115.07 per barrel, up 98 cents (0.9%) from the previous session.