The stock market closed out June on a high note, with the S&P 500 and Nasdaq reaching record levels Friday, signaling investor optimism despite recent economic and political turbulence.
Wall Street’s comeback complete
The S&P 500 rose 0.5% to 6,173.07, surpassing its February peak and erasing losses from April’s near bear market. The tech-heavy Nasdaq also climbed 0.5% to a record 20,273.46, reflecting Big Tech’s dominance and investor enthusiasm over artificial intelligence (AI).
Markets wavered late in the day after President Trump said the U.S. was halting trade talks with Canada over its digital services tax. However, stocks rebounded before the closing bell as Canada announced the tax would be scrapped to revive negotiations.
AI and policy shifts drive market optimism
- AI remains a key driver of the rally, with chipmaker Nvidia and other tech giants posting strong gains.
- The Nasdaq 100, tracking top tech firms, also hit a record earlier this week.
- Trump’s administration has paused reciprocal tariffs and is pushing for trade deals with major partners including China and the U.K.
Treasury Secretary Scott Bessent indicated talks could conclude by Labor Day, easing fears of renewed tariff shocks.
Dow lags behind but posts gains
The Dow Jones Industrial Average rose 432 points (1%), buoyed by broad gains but held back by underperforming stocks like UnitedHealth and Apple. It remains 2.7% below its all-time high.
Despite this, all three indexes posted their best week in over a month.
What could come next?
- The Fed is weighing interest rate cuts amid softening inflation and stable economic data.
- Risks remain: stalled legislation on domestic policy, potential new tariffs after July 9, and geopolitical tension in the Middle East.
- Valuations are high — the S&P 500’s price-to-earnings ratio now exceeds 23, signaling potential overheating.
Key takeaways
- S&P 500 and Nasdaq closed at record highs Friday.
- AI and easing trade tensions fueled the rally.
- Dow lags slightly but gained over 3% this month.
- Investors now eye July’s jobs report and ongoing tariff negotiations.
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