S&P 500, Nasdaq end higher, notch weekly gains after earnings-heavy week

NEW YORK - The S&P 500 and the Nasdaq advanced to record closing highs on May 1, boosted by robust earnings and a dip in crude prices, and turning the page on their biggest monthly percentage gains in years.

The S&P 500 joined the Nasdaq in positive territory, with tech strength putting the latter out front. Both indexes logged their sixth consecutive weekly advances, their longest run of weekly gains since Oct 2024.

As May begins, the stock market embarks on what is historically a weak six-month stretch. Since 1945 through April 2026, the S&P 500 has gained an average of about 2 per cent from May to October, according to data from Fidelity. That compares with an average gain of about 7 per cent from November through April.

Wrapping up a momentous week for corporate earnings, in which reporting companies accounted for more than two-fifths of the S&P 500‘s total market capitalisation, analysts now see aggregate first-quarter earnings growth of 27.8 per cent, year-on-year, according to LSEG I/B/E/S.

Five of the companies in the Magnificent Seven group of artificial intelligence-related stocks reported this week, and investors paid close attention to the timing and extent to which huge investments in the nascent technology are starting to pay off.

That’s an 11.7 percentage point increase from where the estimate stood a week ago, and marks the biggest earnings growth since the fourth quarter of 2021.

Of the 314 companies that have posted results, 83 per cent have beaten earnings estimates, and 78 per cent reported better-than-expected revenues, according to LSEG.

“Today’s action is really the cherry on top of another solid week for investors as earnings season continues to come in stronger than expected,” said Ryan Detrick, chief market strategist at Carson Group in Omaha. “At the same time, we had the second-best April for the S&P 500 since 1950.”

“It looks like that upward momentum very well could continue in May,” Detrick added.
Geopolitics, crude prices and the economyProgress toward a peaceful resolution to the US-Israeli war on Iran appeared stalled, with the closure of the Strait of Hormuz putting upward pressure on energy prices and stoking inflation worries.

But front-month crude futures eased after Iran was reported to have submitted a fresh proposal for negotiations with Washington.

“Investors are pricing out how long they expect that supply disruption to last, and then differentiating who’s got the most sensitivity to that disruption,” said Tom Hainlin, national investment strategist at US Bank Wealth Management in Minneapolis.

Economic data showed US factory activity expanded in April for the fourth consecutive month, but the prices-paid component - an inflation predictor - jumped to its hottest level in four years, according to the Institute for Supply Management.

According to preliminary data, the S&P 500 gained 20.46 points, or 0.28 per cent, to end at 7,229.47 points, while the Nasdaq Composite gained 217.67 points, or 0.87 per cent, to 25,109.98. The Dow Jones Industrial Average fell 155.67 points, or 0.31 per cent, to 49,496.47.

Apple shares advanced after the company provided a solid sales forecast, touting strong demand for its flagship iPhone 17 and the MacBook Neo.

Atlassian shares surged after the enterprise software firm hiked its forecast.

Peers Salesforce and ServiceNow also gained ground.

Roblox slid following a cut in its annual bookings forecast. Reddit jumped after an upbeat quarterly revenue forecast.

Exxon Mobil’s quarterly profit was hit by Middle East disruptions, while Chevron beat earnings expectations but overall profit marked its lowest level in five years. Both supermajors closed lower. REUTERS