NEW YORK (AP) — Wall Street closed its best month since 2023 with a quiet day of trading. The S&P 500 was essentially flat as it finished a winning week and its first winning month in the last four. The Dow Jones Industrial Average rose 0.1%, and the Nasdaq composite fell 0.3%. Hopes climbed through the month that the worst of the pain caused by President Donald Trump’s tariffs may have already passed, though uncertainty still hangs over the market. Treasury yields edged lower in the bond market following encouraging reports on inflation and consumer sentiment in the United States.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
NEW YORK (AP) — Wall Street is giving back some of its winning week and month on Friday following a mixed set of profit reports from Gap, Ulta Beauty and other companies navigating the challenges created by President Donald Trump’s on-and-off tariffs.
The S&P 500 was down 0.6% in afternoon trading. The Dow Jones Industrial Average was down 100 points, or 0.2%, 2 p.m. Eastern time, and the Nasdaq composite was 1.1% lower.
Gap weighed on the market even though the retailer reported stronger profit and revenue for the latest quarter than analysts expected. The company behind Banana Republic and Old Navy fell 18.2% after saying tariffs on imports from China and other countries could add up to $300 million to its costs this fiscal year. It has strategies set to mitigate up to half of that before it hits its profits.
This week and month on Wall Street have been dominated by questions about what will happen with Trump’s tariffs, which investors worry could grind the economy into a recession, slash companies’ profits and layer even more challenges on households already sick of inflation.
Hopes had largely been rising that the worst of such worries had passed, which in turn sent stocks rallying, after Trump paused his tariffs on both China and the European Union. A U.S. court then on Wednesday blocked many of Trump’s sweeping tariffs. That has the S&P 500 on track for its first winning month in four and its best since November.
But the tariffs remain in place for now while the White House appeals the ruling by the U.S. Court of International Trade, and the ultimate outcome is still uncertain. Trump also briefly shook markets shortly before Wall Street opened for trading Friday, when he accused China of not living up to its end of the agreement that paused their tariffs against each other.
“So much for being Mr. NICE GUY!” Trump said on his Truth Social platform.
The impact was limited though, and futures for U.S. stock indexes quickly pared their losses. Since Wednesday’s ruling, analysts and investors have been saying Trump and his administration would likely look for new avenues to impose tariffs on trading partners.
Trump has said he’s using tariffs to bring manufacturing jobs back to the United States and that U.S. households and businesses may feel some pain in the process.
Friday's most influential losses came from several Big Tech stocks. Nvidia dropped 3.8% to give back some of its gain from earlier in the week after it topped analysts' expectations for profit in the latest quarter. It was the single heaviest weight by far on the S&P 500.
On the winning side of Wall Street was Ulta Beauty, which rose 11.2% after the retailer reported stronger sales and profit than analysts forecast. It also raised the top end of its forecasted range for revenue this fiscal year even though CEO Kecia Steelman called the operating environment “fluid.”
Costco climbed 3.5% after the retailer's results and revenue for the latest quarter edged past analysts’ expectations.
Red Robin Gourmet Burger soared 65.7% after reporting a profit for the latest quarter, when analysts expected a loss.
Shares of SharpLink Gaming rose 2.3%, to bring its gain for the week to a whopping 1,105% after the marketing company said it would raise $425 million to buy the cryptocurrency on the Ethereum blockchain. The company delivers leads to U.S. sportsbooks and global casino companies, and it has been expanding into the global crypto gaming market.
In the bond market, Treasury yields edged lower after a report showed that the measure of inflation that the Federal Reserve likes to use was slightly lower in April than economists expected.
A separate report from the University of Michigan said that sentiment among U.S. consumers was better in May than economists expected. Sentiment improved in the back half of the month after Trump paused many of his tariffs on China.
“Overall, consumers see the outlook for the economy as no worse than last month, but they remained quite worried about the future,” according to Survey of Consumers Director Joanne Hsu.
The yield on the 10-year Treasury eased to 4.41% from 4.43% late Thursday. The two-year Treasury yield, which more closely tracks expectations for what the Fed will do with overnight interest rates, edged down to 3.91% from 3.92%.
The Fed has left its benchmark borrowing rate steady so far this year after cutting them at the end of 2024 to give the economy more breathing room. Fed officials have said they want to wait longer to see how tariffs will affect inflation and the economy before making their next move. While lower interest rates can give the economy a boost, they can also fan inflation higher.
In stock markets abroad, European indexes were mixed, while Asian markets fell.
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AP Business Writers Matt Ott and Yuri Kageyama contributed.
Stan Choe, The Associated Press
