Trump Tweets, Courts Fight & Markets Moonwalk

The Week That Was

This week felt like watching a legal thriller where the plot twists came faster than a Taylor Swift outfit change. Wall Street served up its strongest May performance in over three decades, with the S&P 500 gaining more than 6% for the month. But Friday's session reminded everyone that tariff uncertainty still lurks like that one friend who shows up uninvited to every party. Trump's trade policies bounced between federal courts like a pinball, while investors tried to make sense of inflation data that delivered some good news for once. Bitcoin decided to crash the $105K party, gold found its groove around $3,300, and tech stocks rode Nvidia's earnings wave like surfers catching the perfect break. Markets closed the week higher despite Friday's late-session jitters, proving that sometimes the best defense against chaos is simply refusing to panic.

Weekly Scoreboard (Mon Close → Fri Close)

Sector Heat Map

Winner & Loser of the Week

• MVP: Bitcoin — The crypto king stormed past $105K like it was breaking through a paper wall. Technical indicators flashed bullish signals with a golden cross formation, while institutional money poured in faster than coffee on a Monday morning. Trading volume spiked 18% on Binance as Americans apparently decided digital gold beats the traditional kind.

• Faceplant: Gap Inc (GAP) — Despite beating earnings expectations, Gap's stock plummeted over 14% in after-hours trading when management revealed Trump's tariffs could wallop operating income by up to $300 million. Sometimes even good news can't outrun bad policy math.

Top 5 Storylines

1. Tariff Legal Ping-Pong — Federal courts played hot potato with Trump's trade policies all week. A lower court blocked "reciprocal tariffs" Wednesday, only to have an appeals court hit pause Thursday. Markets whipsawed on each headline, proving that uncertainty remains the only certainty.

2. Nvidia Earnings Magic — The AI chipmaker's blockbuster results lifted tech stocks like a SpaceX rocket. Despite China restrictions, Nvidia proved demand for AI chips remains hotter than a summer day in Texas. Stock rallied over 3% Thursday, pulling the entire Nasdaq along for the ride.

3. Inflation Finally Cooperates — April's PCE data showed inflation cooling more than economists expected. The Fed's favorite price gauge delivered exactly what Powell ordered, giving markets hope that rate cuts might still be on the menu for later this year.

4. EU Tariff Delay Drama — Trump's Sunday announcement postponing EU tariffs until July 9 sent stocks soaring Tuesday. The S&P 500 jumped 2.1% in its best single-day performance of the month, proving that sometimes the best news is no news.

5. Monthly Performance Party — May turned into the strongest month since November 2023. The S&P 500's 6%+ gain marked the best May performance since 1990, when MC Hammer was still relevant and nobody had heard of the internet.

Macro & Money Flow Check

• Yield Curve: 10-yr at 4.43% down from 4.47% Monday, showing bond bulls flexing their muscles on inflation relief.

• Credit Spreads: Investment grade spreads tightened modestly as risk appetite improved mid-week.

• Volatility: VIX closed around 19.18, down from week's highs but still elevated above historical norms.

• Sentiment: Extreme greed reading of 78 on Bitcoin Fear & Greed Index suggests crypto euphoria might be getting ahead of itself.

Gold & Hard-Asset Recap

Gold staged a mini-comeback from weekly lows, with futures climbing nearly 1% Thursday on disappointing jobless claims data. The yellow metal found support around $3,292 as dollar weakness of 0.6% provided tailwinds. Oil futures traded choppy around $61-62 per barrel, caught between geopolitical tensions and demand concerns.

Real-Estate Roundup

Mortgage rates continued their sideways dance near multi-month highs as 10-year yields remained elevated despite week-end decline. REITs underperformed broader markets, weighed down by persistent rate uncertainty and commercial real estate headwinds. Housing data remained sparse this holiday-shortened week.

Next Week's Teasers

• Fed Watch: PCE follow-up data and potential Powell commentary brewing

• Mega-Cap Earnings: Apple, Microsoft quarterly results on deck

• Data Drop: May employment report could shift Fed expectations

• Wildcard: Supreme Court tariff decision timeline accelerating

(We'll dissect these in tomorrow's Sunday Night Outlook.)

The Wrap 

May went out like a lion tamer who forgot to bring the whip—lots of drama but somehow everything stayed in line. Markets proved they can climb walls of worry, even when those walls are built from tariff tweets and court documents. Bitcoin bulls celebrated like they just won the lottery, while traditional assets played it cooler than a cucumber sandwich at Wimbledon. The summer trading season kicks off next week with enough uncertainty to keep things interesting. Whether you're counting AI chips or counting sheep, this market keeps reminding us that the only constant is change—and maybe Nvidia's ability to beat expectations.

"Refill the mug and buckle up—June's forecast calls for continued scattered volatility with a chance of surprises."