Contracts for the S&P 500 Index rose 0.2% and those for the tech-heavy Nasdaq 100 climbed 0.1% after the underlying gauges closed at all-time highs on Thursday, following solid earnings from tech megacaps. Apple Inc. shares advanced in extended trading after delivering a strong revenue forecast. The Nikkei stock index in Japan edged up, with several markets in Asia shut for a holiday.
Meanwhile, the yen was slightly weaker at around 157.14 per dollar after rising as high as 155.57 on Thursday. The strengthening came as Japan intervened in the foreign-exchange market hours after officials delivered a “final” warning to investors against selling the currency.
The Finance Ministry in Tokyo didn’t respond to requests for comment. However, Japan’s Nikkei newspaper, citing a government official, reported that the government bought yen and sold dollars. Several traders and strategists also said the abruptness of the move indicated action.
Traders had plenty to contend with in April, as oil prices surged on the Middle East crisis with no resolution in sight, yet US stocks still posted their best month since 2020, driven by a resurgence in technology shares and the artificial intelligence trade. Investors will test that narrative in the coming weeks, watching whether AI-led momentum can offset price pressures and geopolitical risks.
“As long as the economy continues to grow and companies are able to grow earnings, we can see higher stock prices even in the face of higher energy prices and inflation,” said Chris Zaccarelli at Northlight Asset Management.
While US gross domestic product accelerated during the first quarter, thanks to the massive upswing in AI business investment, it also showed inflationary pressures picked up sharply in March as the war spurred a surge in gasoline prices. The personal consumption expenditures price index — the Fed’s preferred measure of inflation — rose 0.7% last month, the most since 2022.Inflation concerns are increasing with European Central Bank policymakers likely to raise interest rates at their next meeting in June unless there are positive developments on energy prices and ending the Iran war, according to people familiar with the situation.
“Investors will be watching how the Federal Reserve navigates this backdrop, with a likely more dovish chair entering what appears to be its most divided committee in decades,” said Bret Kenwell at eToro.