U.S. stocks closed out the week with mixed results, with the S&P 500 slipping 0.2% but remaining close to its all-time high. The Dow Jones Industrial Average edged up slightly, while the Nasdaq composite dropped 0.2%. Nvidia, which had seen a meteoric rise in its stock price fueled by the demand for its chips, experienced a 3.2% drop, resulting in its first losing week in nine.
Sarepta Therapeutics saw a substantial jump in its stock price after receiving approval for its medicine for children with Duchenne muscular dystrophy. On the other hand, gun maker Smith & Wesson Brands experienced a 12.9% decline despite reporting stronger-than-expected profits. Trump Media & Technology Group also saw fluctuations in its stock price, rallying back from an early loss to trim its losses for the week.
In the bond market, U.S. Treasury yields initially fell following reports of weaker business activity in eurozone countries. However, a later report indicated that U.S. business activity may be stronger than expected, leading to a recovery in yields. The Federal Reserve is facing the challenge of balancing the economy with high interest rates to combat inflation. Traders are hopeful that the Fed can manage the delicate balance, with predictions of at least two interest rate cuts later in the year.
Stock markets in Europe and Asia experienced declines, with European stocks dropping after weak economic reports. The Federal Reserve has indicated the possibility of one or two rate cuts in 2024, while the economy continues to grow despite recent slowdowns. Housing and manufacturing sectors have been impacted by high rates, with lower-income households struggling to keep up with rising prices. The yield on the 10-year Treasury edged down slightly, while the two-year Treasury yield dipped, tracking expectations for Fed action.
