The S&P 500 closed lower for the third straight day on Friday. Investors weighed ongoing tensions in the Middle East and what the Federal Reserve might do next with interest rates. The index slipped 0.22% to end at 5,967.84.
The Nasdaq Composite fell 0.51% to 19,447.41. The Dow Jones Industrial Average inched up 35.16 points, or 0.08%, to 42,206.82. Investors were cautious as tensions simmered between Israel and Iran.
Israeli Prime Minister Benjamin Netanyahu has reportedly ordered military strikes on targets in Iran. President Donald Trump is considering direct U.S. involvement. Trump also continues to criticize Fed Chair Jerome Powell for delaying interest rate cuts.
He claims this is costing the U.S. “hundreds of billions of dollars.”
Fed Governor Christopher Waller hinted at potential rate cuts as early as July. But the Fed remains dependent on economic data. This follows Powell’s statement on Wednesday that the Fed is not in a rush to cut rates.
The economic impacts from trade policies and tariffs remain uncertain. For the week, the S&P 500 was down 0.2%. The Dow gained a slight 0.02%.
The Nasdaq rose 0.2%. Chip stocks were pressured after a Wall Street Journal report of increased regulations for some semiconductor makers.
Geopolitical tensions weigh on stocks
This led to declines in the sector. Several stocks reached new 52-week highs. Others, like Molson Coors and Constellation Brands, hit new lows.
Morgan Stanley expects this year’s Fed stress test to be less stringent than in 2024. The test assesses the financial resilience of major U.S. banks under adverse economic conditions. Ether ETFs saw significant inflows for the sixth straight week.
But the price of ether itself remains flat for the month. JPMorgan recommended buying the dip in Arista Networks. It cited Arista’s strong position in the AI networking sector despite underperforming this year.
Circle Inc. stock soared 18% after the Senate approved the GENIUS Act, a landmark stablecoin legislation. Circle shares have skyrocketed over 500% since the bill passed.
GXO Logistics rose over 11% after raising its full-year earnings outlook and appointing a new CEO. CarMax gained 6% following strong quarterly results. Building stocks rallied amid a bidding war for GMS.
Offers from billionaire Brad Jacobs’ financial group and Home Depot pushed GMS shares over $100. Overall, the stock market had a tumultuous week. Geopolitical tensions and central bank policies dominated investor sentiment.