U.S. equities hit new peaks on Friday, with after-hours action steadying at those record levels. Robust jobs numbers and another wave of AI-driven buying propelled both the S&P 500 and the Nasdaq higher. The S&P 500 climbed 0.84% to finish at 7,398.93. Nasdaq Composite jumped 1.71% to 26,247.08. The Dow edged up—just 0.02%—to 49,609.16.
The timing is key: investors see the economy as strong enough to keep earnings on track, yet not so heated that the Federal Reserve has to act. U.S. employers created 115,000 jobs in April, topping the 62,000 figure economists in a Reuters poll had forecast. The unemployment rate stuck at 4.3%.
In the May 8 after-hours stretch—running from 4 p.m. to 8 p.m. ET—major indexes barely budged. According to StockAnalysis, the S&P 500 ticked 0.02% higher, Nasdaq 100 added 0.15%, the Dow edged up 0.05%, while the Russell 2000 slipped by 0.01%.
The rally didn’t spread everywhere, but it hit hard where it mattered. Nvidia picked up 1.8%. Micron Technology and Sandisk surged above 15% apiece—buyers kept piling into stocks linked to the AI data-center push. The Philadelphia SE Semiconductor index popped again, now up 55% for the quarter.
“This is an economy that seems hard to wreck,” said Rob Williams, chief investment strategist at Sage Advisory Services, in comments to Reuters. He cited productivity gains, steady consumer spending, wealth effects, and corporate earnings as the main props for the market. Reuters
Strong earnings fueled another leg up in the market. Out of 440 S&P 500 firms that have posted first-quarter numbers so far, 83% topped Wall Street’s profit forecasts, according to LSEG data cited by Reuters. That’s well above the 67% long-term average.
Cloudflare shares tumbled 24%, with the company planning to lay off around 20% of its staff and projecting second-quarter revenue that missed analysts’ estimates. Trade Desk slipped 1.8%. CoreWeave, which raised the lower end of its full-year capex outlook, dropped 11.4%. Expedia, citing weaker demand tied to the Middle East conflict, fell 9%.
AI remained the main driver. RBC Capital Markets boosted its S&P 500 year-end target to 7,900, up from 7,750, pointing to sturdy earnings growth and momentum across AI-related sectors. The firm flagged demand for AI infrastructure as a key prop for valuations, leaving market leadership firmly with large-cap growth names.
The catch: this market, which brushed off oil shocks and geopolitical worries before, might be running out of slack for bad news. Brent crude climbed past $100 a barrel as optimism dimmed for a fast fix in the Middle East conflict and the reopening of the Strait of Hormuz, a crucial channel for oil and LNG shipments.
Scott Anderson, chief U.S. economist over at BMO Capital Markets, flagged that labor demand and supply are still “in an uneasy balance,” and said things could deteriorate fast if higher prices start to erode consumer buying power. As for interest rates, Anderson said the jobs data offered the Fed little incentive to change its wait-and-see stance on cuts. Reuters
Another batch of hurdles lands next week: inflation figures, producer price numbers, retail sales, plus fresh results from Cisco and Applied Materials. Investors will also be watching for moves in the Iran conflict and a scheduled U.S.-China summit. “We have seen this tremendous rebound as markets have willed themselves to focus on only the positive,” Kristina Hooper, chief market strategist at Man Group, told Reuters. Reuters
