The Dow Jones Industrial Average continued its winning streak on Friday, with the 30-stock index rising 92 points, or 0.2%. The S&P 500 also saw gains of about 0.1%, while the Nasdaq Composite dipped slightly by 0.1%.
One of the standout performers on the Dow was 3M, with shares of the manufacturer climbing 1.9% following an upgrade from HSBC. However, the market was met with some sobering news as consumer sentiment data released on Friday showed a significant increase in inflation expectations. The University of Michigan’s consumer sentiment index for May came in at 67.4, well below expectations and marking its lowest reading in six months.
Brian Nick, senior investment strategist at the Macro Institute, noted that the data could signal concerns about both the economy and inflation, creating a challenging environment for stocks and bonds. The Federal Reserve’s decision on interest rates will be closely watched, with Nick highlighting that the central bank’s path will be influenced by consumer spending and hiring trends.
Despite these uncertainties, investors have been buoyed by the Federal Reserve’s indication that a rate hike is unlikely, potentially paving the way for a rate cut. A strong earnings season and positive labor data have also contributed to a more optimistic outlook for stocks.
For the week, the Dow, S&P 500, and Nasdaq are all on track for gains, with the Dow up 2.1%, the S&P 500 up 1.8%, and the Nasdaq up 1%. The market will continue to monitor economic data and Federal Reserve actions in the coming days to gauge the direction of stocks and bonds.
