The stock market experienced a notable rebound last week, with the Nasdaq ending its five-week losing streak on Friday, fueled by strong performances from major tech companies such as Meta Platforms, Nvidia, and Amazon. The Nasdaq closed the week up 1.9%, while the S&P 500 increased by 1.1%, marking the end of a two-week decline. A significant factor in this recovery was the Supreme Court’s decision against former President Donald Trump’s emergency tariffs, which provided relief to many consumer-focused firms facing higher import costs.
The decision enabled the S&P 500 to gain 0.7% on Friday. The court asserted that the tariff powers sought by Trump lacked the necessary congressional authorization. Although Trump has threatened to implement new tariffs, these measures may only remain in place for up to 150 days without further congressional support. While some stocks initially responded positively to the ruling, such as Nike, concerns about potential alternative tariffs kept the market cautious.
In the technology sector, significant gains were made as Meta announced plans to incorporate Nvidia chips in its data centers, leading to respective weekly increases of 2.5% and 3.8% for Meta and Nvidia. Amazon rose by 5.6% after a substantial investment from Bill Ackman’s fund was disclosed, reinforcing positive market sentiment. Meanwhile, concerns in the financial sector emerged following Blue Owl Capital’s withdrawal restrictions, suggesting underlying issues in the private credit market. This concern impacted shares of major asset managers, although the wider market remained stable.
Why this story matters
- Highlights the influence of legal decisions on market performance.
- Demonstrates the resilience of the tech sector amidst economic uncertainties.
Key takeaway
- The Supreme Court ruling provided a boost to consumer companies and signaled potential volatility in private credit markets.
Opposing viewpoint
- Concerns persist about the sustainability of market gains, particularly in light of ongoing tariff threats and issues within the private credit sector.
