S&P 500 Catches its Longest Winning Run Since January – US Market Wrap

A strong Wall Street week concludes with stock gains, as a rally in the market’s most influential group offsets conflicting signals about progress in President Donald Trump’s trade talks.

The surge in megacap stocks propelled the S&P 500 above 5,500, marking the gauge’s longest advance since January. Tesla soared 9.8%, while Alphabet rose on strong earnings. Equities briefly fell as Trump suggested that another delay in reciprocal tariffs was unlikely, and that he would not lower tariffs on China without “something substantial” in return. Bond prices and the value of the dollar increased.

Worries about the economic consequences of tariffs pushed US consumer sentiment to one of its lowest readings on record, while long-term inflation expectations rose to their highest level since 1991.

As investors weighed mixed signals about whether the trade war between the world’s two largest economies is de-escalating, following reports that China is considering suspending its 125% tariff on some US imports.

Trump told Time magazine that he expects to finalise trade deals with US partners seeking lower tariffs in three to four weeks. However, the president sent mixed signals about the status of talks with China, even though Beijing has denied that negotiations are taking place.

While recent data indicate that US spending has held up thus far, the outlook for this year is less promising. With companies preparing to pass on tariff and commodity costs to customers, the increases may further slow consumer demand and boost inflation.

Profit margins remain close to record levels, giving Corporate America some leeway to absorb tariff costs. However, the track record of S&P 500 companies over the last two decades suggests that their ability to withstand additional levies is shaky, at least in one respect.