The stock market had another winning week.
The S&P 500 closed 2.9% higher than last Friday, logging its ninth-straight win at the end of the week. The Nasdaq Composite was 3.4% higher than Friday's close and the Dow Jones Industrial Average registered a 3.0% gain.
Factors contributing to the inclination to buy included:
Optimism around the trade war situation after China suggested that it is leaving the door open for trade talks with the U.S.
Positive responses to earnings from Microsoft, which increased 11.1% from last week, and Meta Platforms, which increased 9.1% from Friday
Momentum after S&P 500 surpassed its 50-day moving average (5,582)
Reacting to the March Personal Income and Spending Report, which showed a nice 0.7% jump in personal spending and unchanged readings for both the PCE and core-PCE Price Indexes on a month-over-month basis, and the April Employment Situation report, which showed a 177,000 increase in nonfarm payrolls and a 4.2% unemployment rate
Apple was left out of the rally, dropping 1.9% this week following its earnings report and Amazon received a muted response to its earnings results, settling 0.5% higher than last week.
The broad advance left ten of the 11 S&P 500 sectors higher. The technology (+4.0%), communication services (+4.2%), and industrial (+4.3%) sectors were the top performers. The energy sector was alone in the red by Friday, dropping 0.7%.
There's still some headwinds in play, though. Some economic data is weakening, keeping fear about a recession part of the market narrative.
The April Consumer Confidence Index slumped to 86.0 (Briefing.com consensus 88.3) from 93.9 in March, pulled down by the lowest reading for the Expectations Index (54.4) since October 2011; meanwhile, average 12-month inflation expectations jumped to 7.0% from 6.0%, hitting their highest level since November 2022.
Market participants were also digesting a relatively soft initial jobless claims number, along with another contractionary reading in the ISM Manufacturing Index in April (i.e., a reading below 50%), and a Q1 GDP report that triggered some stagflation worries with real GDP down 0.3% and the GDP Price Deflator up 3.7%.