United States equity markets closed in mixed territory on Friday (Saturday AEST), as investors weighed geopolitical tensions surrounding the fragile ceasefire between the United States and Iran alongside fresh inflation data and the upcoming earnings season.
The Dow Jones Industrial Average fell 269.2 points or 0.6%, to 47,916.6, the S&P 500 slipped 7.8 points or 0.1%, to 6,816.9, while the Nasdaq Composite outperformed, rising 80.5 points or 0.4% to finish at 22,902.9.
Despite the subdued finish, all three major indices posted strong gains for the week. The Dow rose 3% over the period, the S&P 500 advanced 3.6%, while the Nasdaq climbed around 4.7%, supported by strength in technology stocks.
Market sentiment remained sensitive to developments in the Middle East. U.S. President Donald Trump on Friday accused Iran of “short term extortion of the World by using International Waterways,” adding in a Truth Social post that Iranian leaders “don’t seem to realize they have no cards” and that “the only reason they are alive today is to negotiate!”
Diplomatic efforts to resolve the conflict faltered over the weekend. Speaking from Pakistan, Vice President JD Vance confirmed that U.S. officials had withdrawn from negotiations after failing to secure commitments from Iran regarding its nuclear programme.
“We have been at it now for 21 hours, and we’ve had a number of substantive discussions with the Iranians. That’s the good news,” Vance said. “The bad news is that we have not reached an agreement.”
Vance identified Iran’s refusal to abandon its pursuit of nuclear weapons as the central obstacle. “We need to see an affirmative commitment that they will not seek a nuclear weapon, and they will not seek the tools that would enable them to quickly achieve a nuclear weapon,” he said, adding that this remained the “core goal” of the negotiations. “They have chosen not to accept our terms.”
In equity markets, semiconductor stocks led gains, with Broadcom and Nvidia rising 4.7% and 2.6%, respectively.
Shares of Taiwan Semiconductor Manufacturing Company also edged 1.4% higher after the world’s largest contract chipmaker reported first-quarter revenue above expectations.
CoreWeave surged 10.9% following the announcement of a multi-year agreement with artificial intelligence firm Anthropic.
By contrast, financial stocks lagged ahead of a busy week for U.S. bank earnings, which will mark the unofficial start of the first-quarter reporting season.
On the macroeconomic front, inflation data provided a mixed picture. The March consumer price index (CPI) rose 0.9% for the month and 3.3% on an annual basis, broadly in line with expectations.
The increase was driven largely by a 10.9% surge in energy prices linked to the ongoing conflict in the Middle East.
However, underlying inflation remained subdued. Core CPI, which excludes energy, increased 0.2% on the month and 2.6% year-on-year, coming in below forecasts and suggesting limited broader price pressures.
Separate data pointed to weakening consumer sentiment. The University of Michigan’s consumer sentiment index dropped sharply to 47.6 in April, down 10.7% from March and marking the lowest level on record. Both current conditions and expectations components recorded double-digit declines.
The deterioration in sentiment coincided with a notable rise in inflation expectations. Survey respondents now anticipate prices will increase 4.8% over the next year, up from the prior month and the highest reading since August 2025.
On the bond markets, yields moved higher, with the 10-year Treasury yield rising to 4.317%, while the 2-year yield climbed to 3.799%.
