May and its big gains are over for Wall Street, so can the market continue to power higher, or is it done for the moment?
US stocks ended mostly higher Friday and booked sharp gains for the week and month as a media conference from President Donald Trump on China turned out to be not as disruptive to trade and finance as had been feared.
Shares globally rallied last week, lifted by optimism over the easing of lockdowns put in place to contain the COVID-19 pandemic and support schemes by central banks and governments across the globe.
For the week US shares gained 3%, Eurozone shares rose 4.7%, Japanese shares rose 8.3% and Chinese shares rose 1.1% while the ASX rose 4.7%. Bond yields were little changed but they rose in Germany and fell significantly in Italy and Spain.
Oil, gold, and copper rose, as did iron ore, especially on Friday (see separate story).
The Dow finished 17.53 points, or less than 0.1%, lower at 25,383.11, but ended Friday well off its intraday nadir at 25,031.67. Meanwhile, the closed 14.58 points, or 0.5%, higher at 3,044.31. The Nasdaq surged 120.88 points, or 1.3%, higher to end at 9,489.87.
For the week, the Dow closed 3.8% higher for the week, while the S&P 500 gained 3%, and the Nasdaq notched a weekly advance of 1.8%.
For the month, the Dow was up 4.3% gain, the S&P 500 climbed 4.5%, while the Nasdaq jumped 6.8% thanks to good performances by tech giants like Microsoft, Netflix, Facebook, Apple, and Amazon.
The gains came despite fears about higher costs for the likes of Apple, Amazon and Facebook.
In a news conference on Friday, President Trump announced a number of measures to address what he claimed was China’s “malfeasance.”
Trump did not mention the trade deal with China signed in January and he did not level sanctions directly against Beijing – the absence of both was seen as positive by investors on Friday.
Trump did suspend entry into America by some Chinese nationals and said he would cut ties with the World Health Organisation, over what he claimed was China’s “total control” of the health agency.
He also said that the US would study the “differing” accounting practice of Chinese companies listing on US stock exchanges and “begin” to end Hong Kong’s special trading status. That will take enough time to become a campaign issue for the November 3 polls.
All these moves were diversionary tracts from the President who is still struggling to handle the impact of COVID-19 and now the race riots across the US after the killing of a black man by police in Minneapolis.
