Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., June 11, 2025.
Brendan McDermid | Reuters
The S&P 500 rose to a new record on Friday, the culmination of an improbable turnaround for U.S. stocks this year as they overcame trade turmoil and geopolitics to reclaim the record set in February. Friday’s gain was driven by hope that trade deals with China and other countries are coming soon.
The S&P 500 added 0.6% to 6,177.14 on Friday, a new record that surpassed the prior all-time high of 6,147.43 from Feb. 19. The Nasdaq Composite rose 0.5% to around 20,218, also a new record high. The Dow Jones Industrial Average added 362 points, or 0.8%.
Late Thursday, Commerce Secretary Howard Lutnick told Bloomberg News that a framework between China and the U.S. on trade had been finalized. Lutnick added that the Trump administration expects to reach deals with 10 major trading partners imminently.
President Donald Trump also said Thursday “we just signed with China yesterday.” A White House official later clarified he meant China agreed to “an additional understanding of a framework to implement the Geneva agreement.” China’s Ministry of Commerce also said Friday that the two countries had confirmed a trade framework that would allow the export of rare earths to the U.S. and ease tech restrictions.
After rising to a new high in February on hopes for business-friendly policies from Trump, stocks tumbled as the president decided to instead implement stiff tariffs first. At its low in April, the S&P 500 was down nearly 18% for 2025. The benchmark then began a stunning comeback after Trump walked back his stiffest tariff rates and the U.S. began negotiations for trade deals.
S&P 500 year-to-date
The S&P 500 is up more than 20% since reaching a nadir on April 8 and now up nearly 5% for the year. Along the way, investors kept buying despite a spike in oil prices from the Israel-Iran conflict and a yield surge on deficit worries. A recovery in the artificial intelligence trade led by Nvidia and Microsoft helped fuel the comeback.
Nvidia hit an all-time high again on Friday, up 2%. Microsoft notched a new record as well before hovering around the little-changed mark.
“The bearish narratives — Middle East conflict, tariffs, soft economic data — keep getting invalidated by the price action. Every chance the market has had to break down has failed. Instead, it continues to do what bull markets do best: climb the wall of worry,” said Ken Mahoney, CEO at Mahoney Asset Management.
The rally wasn’t derailed by a slightly hotter-than-expected reading of the Federal Reserve’s preferred inflation gauge. The May reading of core personal consumption expenditures price index advanced 2.7% year-over-year in May, while economists polled by Dow Jones forecast an increase to 2.6%. Investors are betting inflation will remain tame despite any impact from the tariffs that remain in place and hope that will pave the way for several Federal Reserve rate cuts this year.
