Weekly Market Commentary

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Week of May. 12 through May. 16, 2025

The S&P 500 index rose 5.3% this week in a broad climb that pushed the market benchmark back into positive territory for the year.

The market benchmark ended Friday's session at 5,958.38 and is now up 7% for the month and 1.3% for 2025.

The week started with a relief rally as the Trump administration unveiled a trade deal with China just days after announcing another such deal with the UK. The deal between the US and China calls for a 90-day suspension of reciprocal duties on each other's goods. The two sides had been in a trade war since President Donald Trump's announcement of sweeping new tariffs early last month.

On Friday, Trump said the US will unilaterally set tariffs for many other countries soon.

"We will be telling people what they will be paying to do business in the United States," he said.

Still, stocks held on to the week's gains, especially in the technology sector, as a number of corporate deals were signed amid Trump's Middle East tour.

All of the S&P 500's sectors posted weekly gains. Technology rose 8.1%, followed by a 7.7% gain in consumer discretionary, a 6.6% rise in communication services and a 5.5% increase in industrials. Energy and financials rose more than 3% each, followed by smaller gains in other sectors.

Super Micro Computer (SMCI) had the largest percentage increase in the technology sector, surging 44% as the company said it signed a memorandum of understanding with DataVolt to develop hyperscale AI campuses in Saudi Arabia. The agreement depends on finalizing one or more binding contracts, with the minimum market value of the planned products estimated at $20 billion, it said. First Solar (FSLR) was also strong, soaring 27% amid a number of positive analyst actions including a rating upgrade from Wolfe Research. First Solar may benefit from a "favorable" US utility-scale solar tax policy, as only "relatively minor changes" were proposed in the Republican budget, UBS said in a note to clients while raising its price target on the stock.

The consumer discretionary sector was boosted by a 17% jump in Tesla's (TSLA) shares. Following the trade deal between the US and China, the electric vehicle maker intends to ship components to the US from China for Cybercab and Semi trucks by the end of May, according to a Reuters report.

In communication services, Fox's (FOX) shares climbed 12% as the media company reported a surprise increase in its fiscal third-quarter earnings. The company's quarterly revenue topped market estimates as the Super Bowl LIX drove sharp gains in its advertising sales.

Health care was the weakest sector, eking out a gain of just 0.3%. UnitedHealth Group (UNH) had the largest percentage drop in the sector, falling 23% as a Wall Street Journal report citing people familiar with the matter said the company is facing a criminal investigation by the US Department of Justice over possible Medicare fraud tied to its Medicare Advantage operations. The company said it hasn't received any notification from the DOJ.

Next week, quarterly earnings reports are expected from Home Depot (HD), Palo Alto Networks (PANW), TJX (TJX), Lowe's (LOW), Medtronic (MDT), Intuit (INTU) and Analog Devices (ADI).

Economic data will include April's leading economic indicators, existing home sales and new home sales.

Provided by MT Newswires.