Wall Street’s main indexes nudged higher on Friday, tracking strength in global stocks after President Donald Trump held off from making an immediate decision on U.S. involvement in the Israel-Iran war.
Trump will take a call in the next two weeks, the White House said on Thursday, as hostilities between the two Middle Eastern countries approached their second week.
Markets have been on edge as Trump has kept the world guessing on his plans - veering from proposing a swift diplomatic solution to suggesting the U.S. might join the fight as Israel aims to suppress Tehran’s ability to build nuclear weapons.
A senior Iranian official told Reuters Tehran was ready to discuss limitations on its uranium enrichment, but zero enrichment will be rejected “especially now under Israel’s strikes”. Foreign Minister Abbas Araqchi has arrived in Geneva to meet European counterparts, who are hoping to establish a path back to diplomacy.
“Any news flow that’s going to lean in the direction of de-escalation is going to be a market positive and we’re seeing that to a certain extent here,” said Art Hogan, chief market strategist at B. Riley Wealth.
Concerns about price pressures in the U.S. were also in focus after Federal Reserve policymakers on Wednesday warned inflation could pick up pace over the summer as the economic effects of Trump’s steep import tariffs kick in. They kept interest rates unchanged.
Wall St indexes rise ahead of Fed’s rate verdict
On Friday, Fed governor Chris Waller said the central bank should consider cutting interest rates at its next meeting given recent tame inflation data and because any price shock from tariffs will be short-lived.
At 10:06 a.m. ET, the Dow Jones Industrial Average rose 123.38 points, or 0.29%, to 42,295.04, the S&P 500 gained 13.34 points, or 0.22%, to 5,994.21 and the Nasdaq Composite gained 38.74 points, or 0.20%, to 19,585.01.
Nine of the 11 major S&P 500 sub-sectors rose. Real estate led sector gains with a 0.7% rise. On the flip side, healthcare stocks lost 0.5%.
All three main indexes are set for weekly gains.
Investors are also bracing for any potential spike in volatility from Friday’s “triple witching” - the simultaneous expiration of single stock options, stock index futures, and stock index options contracts that happens once a quarter.
Among megacap stocks, Apple advanced 1.3%.
Kroger rose 6.4% after the grocery chain increased its annual identical sales forecast.
Mondelez International gained 2.4% after brokerage Wells Fargo upgraded the Cadbury parent to “overweight” from “equal-weight”.
Accenture fell 7.2% after the IT services provider said new bookings decreased in the third quarter.
Wall Street’s strong gains last month, primarily driven by a softening in Trump’s trade stance and strength in corporate earnings, had pushed the benchmark S&P 500 index close to its record peaks before the ongoing conflict in the Middle East made investors risk-averse.
The S&P 500 index now remains 2.4% below its record level, and the tech-heavy Nasdaq is 2.8% lower.
Advancing issues outnumbered decliners by a 2.16-to-1 ratio on the NYSE and by a 1.45-to-1 ratio on the Nasdaq. The S&P 500 posted 12 new 52-week highs and 2 new lows while the Nasdaq Composite recorded 55 new highs and 31 new lows.
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