Weekly Market Summary: Wall Street, Gold, and the Fed Drive the Markets

Weekly Market Summary: Wall Street, Gold, and the Fed Drive the Markets

Labor Data Exceeds Expectations, Boosting Wall Street

The U.S. stock market closed the week with strong gains following the release of the May jobs report, which exceeded analysts’ expectations and temporarily eased fears of an imminent economic slowdown.

Performance of Major Indexes

All three major Wall Street indexes reacted positively to the labor figures.

• Dow Jones Industrial Average jumped 443.13 points (1.05%) to end at 42,762.87.
• S&P 500 surpassed the symbolic 6,000-point mark, finishing at 6,000.36—a level not seen since February.
• Nasdaq Composite rose 1.20%, closing at 19,529.95.

This upward movement followed a volatile week during which investors weighed conflicting economic data and speculated on the future direction of Federal Reserve policy.

Market Reactions to the Jobs Report

According to the U.S. Department of Labor, the economy added 139,000 nonfarm jobs in May, exceeding the market’s forecast of 125,000. Although this figure is lower than the revised 147,000 in April, it reinforces the perception that the labor market remains resilient.

The unemployment rate remained steady at 4.2%, which was also interpreted positively by markets, as it alleviated concerns of a sudden halt in economic activity.

Tesla Shakes the Nasdaq, but Tech Sector Maintains Momentum

Technology remained at the forefront of Wall Street this week. Although Tesla experienced a sharp decline, the sector as a whole ended on a high note thanks to strong performances from companies like Nvidia, Meta, and Apple.

Tesla’s Steep Drop and Its Political Origin

Tesla (TSLA) shares plummeted 14.3% following a public dispute between its CEO, Elon Musk, and President Donald Trump regarding a reconciliation bill. The conflict, which escalated on social media, stirred volatility in the Nasdaq, where Tesla holds significant weight.

This sharp drop briefly affected sentiment in the electric vehicle sector, although broader market momentum helped cushion the blow.

Key Gainers: Nvidia, Meta, and Apple

Despite Tesla’s stumble, other tech giants helped lift the index. Nvidia (NVDA) led gains in the semiconductor segment, continuing its rally on the back of soaring demand for AI-related chips.

Meta Platforms (META) and Apple (AAPL) also ended the week in positive territory. Apple benefited from growth expectations in its Cloud and Networking Products division, while Meta made further progress in monetizing new social media features.

The Nasdaq Composite, heavily weighted in tech stocks, posted a 2.2% weekly gain, showcasing the sector’s resilience despite isolated disruptions.

Outlook for the Fed: Stay the Course or Shift Gears?

The strong May jobs report reignited debate over the future trajectory of U.S. monetary policy. Markets, which until recently were pricing in multiple rate cuts for the year, have begun to reassess, adopting a more cautious stance.

Tariff Tensions and Contradictory Signals

The report showing 139,000 new jobs and an unchanged unemployment rate of 4.2% paints a picture of a moderately strong labor market, complicating the narrative of an imminent monetary policy shift. Recent commentary from economists suggests that the Federal Reserve may wait until September before making any move.

Adding to the uncertainty is the lack of clarity in trade negotiations with China. Despite a “very positive” call between Presidents Trump and Xi, markets remain wary of how future tariff developments might unfold.

Market Expectations Ahead of the Next Fed Meeting

Based on short-term interest rate futures, the likelihood of three rate cuts before year-end has dropped significantly. Markets now foresee only one possible cut by late 2025. This reassessment is already reflected in the bond market, with the 10-year Treasury yield climbing to 4.51% by the week’s end.

With the Federal Open Market Committee (FOMC) set to meet on June 17–18, investors will be watching closely for any shifts in tone or guidance from Chair Jerome Powell.

Europe and Asia: Monetary Adjustments and Mixed Signals

While U.S. markets cheered strong employment figures, central banks abroad also made notable moves. Europe and Asia offered contrasting signals this week, reflecting the different stages of the global economic cycle.

ECB Rate Cut Boosts Market Sentiment

The European Central Bank (ECB) cut interest rates by 25 basis points, a move widely anticipated by financial markets. This marked the first rate reduction in over a year and was seen as a potential turning point toward a more accommodative monetary policy.

• Stoxx Europe 600 rose 0.3%.
• UK’s FTSE 100 gained 0.3%.
• France’s CAC 40 added 0.2%.
• Germany’s DAX slipped slightly by 0.1%, reflecting cautious sentiment amid a complex economic backdrop.

The rate decision coincided with an upward revision to the eurozone’s Q1 GDP, lending further support to a narrative of modest but stable growth in the region.

Deflation in Switzerland and Prospects of Negative Rates

In contrast, Switzerland surprised markets with a return to negative inflation for the first time since the pandemic. This development has increased pressure on the Swiss National Bank (SNB), with traders now betting on a return to negative interest rates by year-end.

Such expectations raise questions about the Swiss franc’s strength and the attractiveness of Swiss financial assets in an environment of divergent global monetary policies.

OPEC+ and Oil: Controlled Production and a Positive Market Reaction

The oil market saw a significant rebound during the week, driven by upbeat U.S. employment data and signs of supply stability from major producers. After two consecutive weeks of declines, oil posted its first weekly gain, restoring investor confidence in global economic momentum.

Agreed Output Increase and Demand Outlook

OPEC+, the coalition of oil-producing nations including Russia, confirmed it would increase output by 411,000 barrels per day in July, as previously announced. While Saudi Arabia had pushed for a larger hike, the decision was interpreted as a sign of unity and control within the group—crucial for maintaining market balance.

Analysts expect supply and demand to remain balanced in Q3, thanks to seasonal increases in consumption during the summer months, aligning with the projected output growth.

• Brent crude closed at $66.47 per barrel, rising 1.73% for the week.
• West Texas Intermediate (WTI) settled at $64.58, up 1.91% daily and 4.9% weekly.

Oil as a Global Economic Thermometer

The oil price rebound was widely seen as a reflection of growing optimism about the global economy. This was further supported by renewed trade dialogue between the United States and China, boosting hopes for stronger demand from the world’s two largest economies.

Precious Metals on the Move: Gold Drops, Silver Surges

Precious metals reacted strongly to the latest economic signals from the U.S. While gold declined following the robust jobs report, other metals such as silver and platinum saw notable gains—making it a mixed but telling week for the sector.

Impact of the Jobs Report on Gold and Rate Expectations

Spot gold fell 1.1%, reaching $3,316.13 per ounce, as the stronger-than-expected labor data reduced the likelihood of an imminent Federal Reserve interest rate cut. Traditionally viewed as a hedge against inflation or economic uncertainty, gold tends to lose appeal in high-rate environments due to its lack of yield.

Despite this drop, gold still closed the week with a 0.8% gain, indicating that investors continue to see it as a strategic asset in case of geopolitical tensions or economic surprises.

U.S. gold futures also fell 0.8%, settling at $3,346.60.

Silver and Platinum Draw Investor Attention

Unlike gold, silver had a breakout week, briefly surpassing the $35 per ounce mark—its highest level in over 13 years—before easing 0.5% to settle at $35.96.

Platinum rose 2.5% to $1,158.20, its highest level since March 2022, while palladium climbed 3.9% to $1,045.45. Both metals closed the week in positive territory, drawing attention from investors interested in industrial and green energy applications.

Corporate Moves: M&A, AI Growth, and Tech Momentum

Beyond macroeconomic factors, markets were also driven by key corporate developments that drew investor attention, particularly in the technology, biotechnology, and industrial sectors.

Broadcom Leads the Semiconductor Surge

Broadcom (AVGO) impressed the market with a projection of $5.1 billion in AI semiconductor revenue for Q3 2025. The company also reported $15 billion in total revenue for Q2, representing a 20% year-over-year increase, largely fueled by booming demand in networking and AI-related hardware.

This announcement reinforced optimism in the semiconductor space, positioning Broadcom as one of the sector’s major winners in the ongoing tech rally.

Notable Mergers: US Steel, Grab-GoTo, and More

Among the most prominent M&A headlines:

• US Steel (X) and Nippon Steel are close to finalizing a $14 billion merger, with advanced discussions to keep US Steel’s headquarters in Pittsburgh. The deal has boosted investor confidence in the industrial sector.
• Tech platforms Grab (GRAB) and GoTo are in talks for a potential $7 billion merger, with Indonesia’s sovereign wealth fund considering a minority stake. The move aims to strengthen regional dominance in Southeast Asia.
• In biotech, Phathom Pharmaceuticals (PHAT) surged 125% after the FDA granted exclusivity for Voquezna, its treatment for digestive disorders.

Other companies such as Lululemon (LULU), Amazon (AMZN), Pfizer (PFE), AeroVironment (AVAV), and Braze (BRZE) made strategic announcements—ranging from international expansion and acquisitions to AI innovation—that influenced market sentiment.

These corporate moves support the narrative that, despite economic and geopolitical uncertainty, businesses are executing long-term growth strategies with confidence.

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