U.S. Stock Market Summary for Thursday, May 22, 2025

 

Major Indices

• S&P 500: -0.04% → 5,842.01
• Dow Jones Industrial Average: -0.00% → 41,859.09
• Nasdaq 100: +0.15% → 21,112.47
• Russell 2000: -0.05% → 2,045.56

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Market Overview
U.S. equities ended Thursday in a narrow range, reflecting investor caution amid mounting fiscal concerns. The House's narrow approval of President Trump's expansive tax-and-spending bill, which could add roughly $2.7 trillion to the federal deficit over the next decade, sparked fresh anxiety about the long-term stability of public finances.

Yields on long-term Treasurys surged, with the 30-year note briefly topping 5% before settling near 5.12%, highlighting concerns about future borrowing costs and inflation. This uptick in yields weighed on equity sentiment, especially in rate-sensitive sectors.

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Sector Highlights

• Technology: The Nasdaq 100's modest advance was supported by gains in heavyweight tech names such as Apple, Nvidia, and Tesla. Despite a late-session pullback in Apple, investor optimism remained intact around AI and chip innovation.
• Renewable Energy: Solar stocks took a hit after the House vote raised the prospect of repealed green subsidies. Sunrun and First Solar posted notable losses as investors reassessed the growth outlook for clean energy under the proposed fiscal plan.
• Quantum Computing: Shares of IonQ surged after its CEO likened the company’s future potential to Nvidia’s dominance in AI, bolstering investor enthusiasm in the nascent quantum sector.

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Economic Snapshot

• Business Activity: The S&P Global U.S. Composite PMI rose to 52.1 in May from 50.6 in April, marking continued expansion in business activity. However, an increase in input prices suggested that inflationary pressures remain persistent.
• Labor Market: Initial jobless claims declined to a four-week low, reaffirming labor market strength. Yet, reports of labor hoarding indicate corporate caution as firms brace for potential macroeconomic headwinds.
• Housing: Existing home sales dipped 0.5% in April, marking a seven-month low and hinting at ongoing fragility in the housing sector amid elevated mortgage rates.

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Expert Commentary

• Jamie Dimon, JPMorgan Chase CEO, warned that the new fiscal package may contribute to stagflation risks despite its potential to boost near-term economic activity.
• Mark Haefele, CIO at UBS Global Wealth Management, noted renewed volatility driven by uncertainty over trade and fiscal policies.
• Thierry Wizman, strategist at Macquarie, cautioned that larger deficits will likely necessitate higher Treasury issuance, though not an immediate threat of default.
• Louis Navellier, Navellier & Associates, emphasized that equity markets require a significant decline in yields to retest recent highs.

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Government & Political Notes
The House of Representatives passed President Trump’s tax-and-spending proposal, which extends key 2017 tax cuts and ramps up defense spending. The legislation now heads to the Senate, where intense scrutiny and amendments are expected. Market participants remain highly sensitive to any changes, given the bill’s wide-reaching fiscal ramifications.

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Conclusion
Wall Street ended Thursday essentially flat, with limited momentum as investors digested the long-term fiscal implications of the newly passed tax bill and rising Treasury yields. While technology stocks displayed relative strength, green energy names were pressured by subsidy concerns. The economic data painted a mixed picture, showing both resilience in business activity and lingering inflation risks. With the Memorial Day weekend approaching, attention will shift toward Senate negotiations on fiscal policy and the upcoming slate of economic releases.