ANALYSIS.
The art of the deal: Nasdaq and S&P 500 close the week with new records
Trump's aggressive economic and trade policy brings the country to "a strong position," and conveys optimism to investors because of signed deals and those being negotiated with strategic partners.
A trader at the New York Stock Exchange.
The economic and trade policy of Donald Trump, marked by pressure with tariffs on trade partners and adversaries continues to pay off for the world's leading economy. Following the success of the latest negotiations in recent days, the New York Stock Exchange closed the week setting new records, in view of investors' optimistic anticipation that the president will close new key agreements with key players.
Markets are hopeful that the trade deal with Japan this week will be followed by more, with other major partners, such as the EU. Indeed, European Commission President Ursula von der Leyen will meet with Trump on Sunday to try to reach a pact that avoids a tariff war.
New highs for S&P and Nasdaq
The S&P 500 rose 0.40% to 6,388.64 points, marking its fifth consecutive record high. The Nasdaq added 0.24% to reach 21,108.32 points, also a new all-time high. The Dow Jones gained 0.47%, closing at 44,901.92 points.
"These all-time highs are backed by optimism around trade deals and strong corporate results" for the second quarter, Angelo Kourkafas of Edward Jones told AFP.
US economy on solid footing
According to the analyst, corporate data suggests the U.S. economy is in a solid position. "That could change in the coming months but for now we have an economy that is holding steady," Kourkafas said.
As the Aug. 1 deadline approaches, investors expect more deals to be reached on the tariffs announced by Trump.
Earnings week for giants like Apple and Amazon
In addition to negotiations with trading partners, investors are anticipating an intense earnings calendar next week, with Apple, Amazon and other big tech companies set to report results.
These are the biggest companies in the market, "so any hiccups will have implications for the broader market," the analyst said.
Eyes on the Fed and rates again
In the bond market, the yield on the US 10-year bond was down slightly at 4.38% versus 4.41% at the previous day's close.
Next week Wall Street will follow the Federal Reserve monetary policy committee (FOMC) meeting, after which market players expect the institution to keep its interest rates unchanged, i.e. in a range between 4.25% and 4.50%.
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