The stock market closed last week with losses, but closed the month of May with solid gains. Mega-cap stocks again had an outsized impact on index performance throughout the month. The single biggest contributor was NVIDIA (NVDA), which jumped 26.9% in May. The equal-weighted S&P 500 gained 2.8% this month, versus a 4.8% gain in the market-cap weighted S&P 500. Last week, however, the S&P 500 logged a 0.5% decline.
Investors had a slate of earnings news to get through last week, including from retailers like Best Buy (BBY), Foot Locker (FL), Kohl’s (KSS), and Dollar General (DG). Dow component Salesforce (CRM) was a losing standout following disappointing quarterly results, leading CRM to close 13.9% lower for the week.
The market also received a mixed batch of economic reports, highlighted by Friday’s release of the April Personal Income and Spending report. The key takeaway from the report is that the year-over-year PCE inflation rates did not worsen; however, they did not improve either, so it seems unlikely that the Fed would find any new confidence in this report that inflation is moving sustainably toward its 2% target. US Treasuries settled mixed this week in response to the data and in response to some poorly received Treasury sales. This week’s $69 billion 2-yr note, $70 billion 5-yr note, and $44 billion 7-yr note sales met weak demand. The 10-yr note yield rose five basis points this week to 4.51% and the 2-yr note yield declined six basis points to 4.89%.
ConocoPhillips agreed on Wednesday to buy Marathon Oil in an all-stock transaction worth $17 billion, bolstering the company’s shale assets. This is the third recent major acquisition among US oil production companies.