US stock markets this week: US stock markets ended the week on a strong note, with all three major benchmarks posting gains of roughly 0.7% over the period as investors welcomed easing geopolitical tensions, falling oil prices and renewed optimism surrounding economic and corporate growth.
The rally continued on Friday, with Wall Street extending gains amid hopes that the United States and Iran are moving closer to a peace agreement that could bring an end to the conflict in West Asia. Investors also closely tracked the blockbuster stock market debut of SpaceX, which surged nearly 20% on its first day of trading and instantly became one of the world’s most valuable publicly listed companies.
Just on Friday, the Dow Jones Industrial Average rose 353.51 points, or 0.70%, to close at 51,202.26. The S&P 500 gained 37.16 points, or 0.50%, to finish at 7,431.46, while the Nasdaq Composite advanced 79.18 points, or 0.31%, to 25,888.84.
A major market event this week was the highly anticipated debut of Elon Musk’s SpaceX on the Nasdaq. Shares of the aerospace and satellite company surged 19.2% to close at $160.95, well above its IPO price of USD 135 per share. Following the strong debut, SpaceX’s market capitalisation climbed to approximately $2.1 trillion, placing it among the largest publicly traded companies in the United States.
What drove the US markets this week?
A major catalyst for the week’s rally was the sharp decline in crude oil prices. fell 3.4% on Friday to $87.33 per barrel, extending losses from earlier sessions. The decline followed US President Donald Trump’s decision to withdraw plans for military strikes against Iran and his comments suggesting that a potential agreement with Tehran could be reached soon.
Investors believe a peace deal could lead to the reopening of the , one of the world’s most important energy shipping routes. Since the conflict began, disruptions around the strait have pushed Brent crude prices from around $70 per barrel to significantly higher levels, contributing to inflationary pressures across global economies.
However, markets remain cautious. Similar optimism regarding a possible end to the conflict has emerged several times in recent months, only to fade when negotiations failed to produce a final agreement.
While geopolitical developments helped improve sentiment, the biggest story for Wall Street over the past week remained the performance of artificial intelligence-related stocks.
AI shares have experienced sharp swings after reaching record highs earlier this year. Investors have increasingly questioned whether valuations in the sector have risen too rapidly amid excitement surrounding artificial intelligence. The resulting volatility has led to frequent reversals in stock prices, sometimes within a single trading session.
The also remained in focus. The yield on the benchmark 10-year US Treasury note rose to 4.48% from 4.45% a day earlier, recovering part of the sharp decline recorded after oil prices fell.
Higher bond yields can weigh on stocks by increasing borrowing costs and reducing the attractiveness of risk assets. They tend to impact high-growth sectors the most, particularly technology and AI-related companies, where some investors have begun warning about the possibility of a valuation bubble.
Economic data released during the week provided additional support to markets. A preliminary survey from the University of Michigan showed that US consumer sentiment improved more than economists had expected. Consumers reported feeling somewhat relieved as gasoline prices moderated earlier in the month.
Investors are now turning their attention to next week’s Federal Reserve policy meeting, the first under Fed Chair Kevin Warsh. Market participants will closely monitor the central bank’s commentary for clues on the future path of interest rates. According to fed funds futures pricing, traders currently see a 55% probability of a rate increase by December.
With geopolitical risks easing, oil prices retreating and economic indicators remaining resilient, Wall Street ended the week with strong momentum. However, investors remain alert to developments surrounding Iran negotiations, interest rates and the increasingly volatile AI sector, all of which could shape market direction in the weeks ahead.
(With inputs from agencies)