U.S. benchmark equity indexes showed unexpected resilience amid rising expectations that a looming government shutdown could be averted. The Nasdaq Composite surged 2.5% to close at 17,735.9 after midday trading on Friday. Simultaneously, the S&P 500 climbed by 2%, reaching 5,634.5, while the Dow Jones Industrial Average improved by 1.5%, settling at 41,439.9.
All sectors reported gains, with technology and energy leading the charge. Financial analysts from Stifel highlighted a growing market optimism, suggesting that the likelihood of avoiding a government shutdown was driving investor confidence. This shift followed the news that Senate Democratic Leader Chuck Schumer had reportedly retracted his objection to the latest spending bill proposal. In the broader economic context, however, U.S.
consumer sentiment took a notable downturn, plunging to 57.9 in March, down from 64.7 recorded the previous month, according to preliminary survey results from the University of Michigan. This was well below the Bloomberg-compiled consensus estimate of 63. Adding to concerns, year-ahead inflation expectations saw a sharp increase to 4.9% this month, the highest level since November 2022, up from 4.3% in February.
Looking further ahead, inflation projections for the next five years have risen to 3.9%, compared to 3.5% noted in the prior month. Joanne Hsu, Director of Surveys of Consumers, articulated uncertainty among consumers, noting, "Expectations for the future deteriorated across multiple facets of the economy," with many expressing worries over high levels of policy uncertainty and various economic factors. Gold demonstrated resilience in the face of economic pressures, rising 0.3% to $2,999.80 per troy ounce during intra-day trading.
Earlier festivities witnessed spot gold surpassing the $3,000 mark, a significant milestone for the commodity. The apprehension surrounding tariff concerns, which could potentially lead to elevated inflation and slower economic growth, has spurred an increased demand for safe-haven assets such as gold, according to insights from ING.
Meanwhile, silver prices remained stable at $34.32 per ounce. U.S. Treasury yields experienced an uptick, with the two-year rate rising by 5.4 basis points to settle at 4%, while the 10-year rate gained 2.5 basis points, reaching 4.30%. In corporate news, shares of Ulta Beauty experienced a remarkable surge of nearly 13%, making it the top performer on the S&P 500 index.
While the beauty retailer's full-year guidance fell short of Wall Street's expectations announced late Thursday, UBS analysts noted signs of potential positive earnings revisions in forthcoming quarters. Crown Castle also made headlines as the second-best performer on the S&P 500, with shares climbing 10% following news that the company had agreed to offload its small cells and fiber solutions businesses for a substantial $8.5 billion to separate buyers, following a strategic review process. Conversely, Regeneron Pharmaceuticals faced a setback as its shares fell by 2.5% during intra-day trading, marking it as the second-worst performer on the S&P 500.
The drop followed reports that a U.S. appeals court had denied the company's attempt to block sales of biosimilar versions of its drug Eylea. Lastly, the price of West Texas Intermediate crude oil rose by 0.7%, reaching $67.03 per barrel, reflecting the market's fluctuating dynamics for commodities amid ongoing economic developments..