Weekly Stock Market Update | Dow, S&P 500, NASDAQ News – May 18, 2025 at 07:00 AM

This week, the US stock market experienced a rise, with both the S&P 500 and Nasdaq reaching a winning streak thanks to an easing in US-China trade tensions. The S&P 500 surged up approximately 0.7%, achieving gains for five consecutive days, while the Dow Jones Industrial Average noted an increase of 0.8%. Nonetheless, it was the Nasdaq Composite that triumphantly led for the week, attaining gains of about 7%.

Some of the standout performers this week were tech stocks, including Nvidia which achieved a rise of around 16%, while Meta Platforms moved up by 8%. Furthermore, Apple saw a 6% increase and Microsoft experienced a 3% rise. Conversely, UnitedHealth’s stock declined nearly 11% following news that the Justice Department may be investigating the insurer.

In forthcoming weeks, Trump’s trade strategies will remain a focus, along with fiscal responses from other countries. The market’s expectation is for easing of tariff measures, giving investors confidence in US trade deals which has reflected positively on stock performance.

Consumer sentiment fell in May as Americans grew more pessimistic about the inflation outlook. Consequently, there is wariness around potential consumer-facing cost increases resulting from tariffs, despite significant market gains following tariff pauses with China.

These gains came as US and Chinese officials agreed on a 90-day truce in their tariff measures, calming investors’ worries of escalating global trade tensions and potential economic risk. However, despite the temporary alleviation of US-China tariffs, investors are cautioned to remain on guard as bear markets often begin with a double-digit decline.

US stock markets posted significant gains over the past week as trade tensions between the US and China seemed to ease. The Dow Jones Industrial Average surged 1,160.72 points, or 2.81%, closing at 42,410.10 while the Nasdaq Composite added 4.35% and settled at 18,708.34. S&P 500 gained 3.26% to finish at 5,844.19. The improvement followed the US and China’s agreement to temporarily cut tariffs, triggering strong buying enthusiasm.

Technology companies reliant on China, such as Tesla and Apple, experienced significant increases due to the initial China agreement. Tesla’s stock jumped nearly 7%, and shares in Apple and Nvidia gained by 6% and 5%, respectively. Other companies heavily dependent on Chinese goods also saw increases, with Best Buy up 6%, Dell Technologies nearly 8%, and Amazon over 8%.

However, US-China trade war optimism began to fade towards the end of the week, and Walmart warned prices would rise as a result of high tariff costs. Shares in Walmart fell less than 1%.

This week, concerns remain regarding a potential inflation rise. Current expectations for inflation over the next 12 months are at 7.3%, up from 6.5% the previous month. This increase could lead to a cycle of behavior worsening inflation.

Despite these concerns, stocks like Home Depot, Target, and Zoom are expected to draw investor attention in the upcoming week.