U.S. stocks showed modest gains in Friday's late trading session, with all three major indices on track to close May in positive territory. Oil prices declined as traders closely monitored Middle East tensions and a fragile ceasefire agreement between Iran and the United States.
The Dow Jones Industrial Average rose 287.26 points, or 0.57%, to 50,956.23. The Nasdaq Composite added 6.13 points, or 0.02%, to 26,923.60. The S&P 500 gained 8.39 points, or 0.11%, to 7,572.02.
Earlier on Friday, U.S. West Texas Intermediate crude futures fell over 2% to $86.89 per barrel. Brent crude also dropped 2% to $91.80. This followed reports of mutual airstrikes between U.S. and Iranian forces on Thursday and considerations by the U.S. administration to potentially extend a ceasefire agreement.
In the previous session, markets reached new record highs after the U.S. and Iran reached an agreement, with Iranian negotiators agreeing to a 60-day memorandum of understanding to extend the ceasefire.
However, Kate Moore, Chief Investment Officer at Citi Global Wealth, suggested that the market's rally to new highs might be driven more by strong corporate earnings growth than by headlines about Middle East tensions.
She stated, "I think a significant portion of the rebound since the March lows is due to the market pricing in an expectation that issues will eventually be resolved, though the scope and timing of any resolution clearly remain unknown. I do believe the real driver pushing the market higher is the earnings strength in the technology sector... This earnings season has seen one company after another delivering such performances."
As the final trading day of May, all three major U.S. stock indices are poised to end the week higher. The technology-heavy Nasdaq Composite led the weekly gains with an increase of over 2%. The S&P 500 rose more than 1% for the week, while the blue-chip Dow Jones Industrial Average gained less than 1%.
For the month of May, all three major indices are set to close with gains. The S&P 500 has advanced nearly 5%, while the Dow is up 2%. The Nasdaq has shown stronger performance, on track for an 8% monthly increase.
Shares of Dell Technologies surged after the laptop manufacturer raised its full-year guidance and reported first-quarter revenue and profit that exceeded expectations.
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