S&P 500, NASDAQ scale fresh record highs

Wall Street rose and major indices continued their climb on Friday, as the S&P 500 and Nasdaq Composite hit new record highs, driven by the momentum of their strongest monthly performance in years.

Sentiment was bolstered by a report from Iranian state media stating that Tehran sent its latest negotiation proposals to the United States via Pakistani mediators on Thursday.

Friday's session concludes a busy week of Big Tech earnings announcements and critical economic data. Analysts now expect Q1 earnings for the S&P 500 to grow by 27.8%—the fastest rate since Q4 2021—compared to a 16.1% forecast last week, according to LSEG I/B/E/S data.

Investors are watching to see if this rally will persist as markets enter May, which historically marks the beginning of a weaker six-month period for stocks. From 1945 through April 2026, the S&P 500 has averaged a gain of approximately 2% between May and October, compared to an average of 7% between November and April, according to Fidelity data.

While earnings results were largely robust, some investors expressed concern over the massive spending wave by tech companies on Artificial Intelligence. Doubts also emerged regarding the sustainability of certain software business models, prompting a re-evaluation of investment portfolios.

Peter Vanderlee, portfolio manager at ClearBridge Investments, noted: "The disruptive potential of AI across software, services, the financial sector, and other industries has created uncertainty about the long-term durability and value of some business models."

Economic data released Thursday also sparked concerns that the equity buying spree might be due for a correction. Although U.S. economic growth regained momentum in the first quarter, consumer spending—the main engine of the economy—slowed, while the personal saving rate declined, suggesting households utilized savings to support spending.

Furthermore, this data reflects only one month of disruptions resulting from the Middle East war. With shipping halted through the Strait of Hormuz, oil prices could become a heavier burden, especially as support from Q1 tax refunds fades.

Data on Friday showed that U.S. manufacturing activity stabilized in April, but supplier delivery performance deteriorated as shipping disruptions in the Strait of Hormuz drove raw material and input prices to a four-year high.

At 09:54 a.m. ET, the Dow Jones Industrial Average rose by 148.14 points, or 0.30%, to 49,800.28. The S&P 500 added 40.71 points, or 0.56%, to 7,249.72, and the Nasdaq Composite climbed 193.21 points, or 0.78%, to 25,085.52—setting new record highs for both indices.

Seven of the 11 major S&P 500 sectors were in the green, with Information Technology leading the gains, up 1.5%.

The S&P 500 concluded April with its largest monthly gain since November 2020, while the Nasdaq Composite recorded its best monthly performance since April 2020. The Dow achieved its strongest monthly rise since November 2024.

Gains driven by strong Apple outlook

Apple shares jumped 4.8% after strong demand for its flagship iPhone 17 and MacBook Neo led to projections of robust sales for the third fiscal quarter.

In the energy sector, ExxonMobil and Chevron reported quarterly profits that exceeded expectations, though their shares remained flat.

Software companies rose after Atlassian raised its annual forecast, causing its stock to surge 27.7%. Shares of Salesforce, ServiceNow, Datadog, and Workday also rose between 1.8% and 5.8%.

Conversely, gaming platform Roblox saw its shares drop 18.4% after cutting its annual revenue forecast, while Reddit rose 7.8% following an optimistic quarterly revenue outlook.