It was another record-setting day for the S&P 500 and Nasdaq Composite, which were lifted by leadership from the mega-cap stocks and a blistering advance by the semiconductor stocks that was paced by Intel (INTC 82.57, +15.79, +23.64%) following its better-than-expected Q1 earnings report and outlook.

The strength of that leadership kept a bid in the information technology sector (+2.5%) throughout the session, which was enough, along with gains in the consumer discretionary (+1.4%) and communications services (+0.9%) sectors, to keep the market-cap-weighted indices afloat, while the Dow Jones Industrial Average (-0.2%) and equal-weighted S&P 500 (-0.2%) languished with modest losses.

AI enthusiasm, momentum, performance chasing, and fundamental earnings strength were the tailwinds pushing the semiconductor stocks to record heights. The Philadelphia Semiconductor Index, led by Intel and NVIDIA (NVDA 208.26, +8.62, +4.32%), surged 4.3%, leaving it up 38.6% since the end of March.

NVIDIA was part of a mega-cap cohort that strengthened as the session progressed. The Vanguard Mega-Cap Growth ETF (MGK 84.22, +1.35, +1.63%) advanced 1.6% and closed near its best levels of the session, underpinned by added strength in Amazon (AMZN 263.99, +8.91, +3.49%), Meta Platforms (META 675.05, +15.90, +2.41%), Microsoft (MSFT 424.60, +8.85, +2.13%), and Alphabet A (GOOGL 344.40, +5.51, +1.63%).

These leadership stocks carried the day, which was also featured the DOJ dropping its criminal probe of Fed Chair Powell, earnings results from Procter & Gamble (PG 148.11, +2.40, +1.65%), and back-and-forth headlines touting the possibility of the U.S. and Iran meeting again this weekend in Pakistan.

It was still unclear as of this post if the two sides were going to actually meet or if they were going to be in Pakistan and use go-betweens to lay the groundwork for resuming ceasefire discussions. WTI crude futures, which flirted with $98.00/bbl at one point, settled the day down 1.4% at $94.42/bbl.

The stock market handled the uncertainty with a sense of resolve, much like it has since the initial ceasefire agreement was announced, clinging to the view that what comes next won't be profoundly harmful to the global economy.

That point notwithstanding, there were pockets of weakness in today's market. The health care sector (-1.4%) was plagued by losses in most components, but namely Eli Lilly (LLY 884.18, -33.47, -3.65%) and HCA (HCA 432.50, -41.53, -8.76%). The latter company reported earnings results that were tarnished by weaker-than-expected patient volumes.

Other laggards included the industrials (-0.9%), financials (-0.6%), consumer staples (-0.4%), real estate (-0.4%), and energy (-0.3%) sectors.

U.S. Treasuries finished a down week on a mostly higher note with shorter tenors pacing a Friday bounce that pressured yields from their highest levels in over two weeks. The 2-yr note yield, which is more sensitive to changes in the fed funds rate, was down five basis points to 3.78%, while the 10-yr note yield ended down one basis point at 4.31%.

• Russell 2000 YTD:+12.2%
• S&P Mid Cap 400:+10.1%
• Nasdaq Composite:+6.9%
• S&P 500:+4.7%
• DJIA:+2.4%

Reviewing today's economic data:

• The final reading for the University of Michigan Consumer Sentiment Index for April edged up to 49.8 (Briefing.com consensus: 47.6) from the preliminary (and record low) reading of 47.6. The final reading for March was 53.3. In the same period a year ago, the index stood at 52.2.
  • The key takeaway from the report is that there was some slight improvement from the preliminary report as gas prices eased a bit following the ceasefire, yet gas prices are still much higher than where they were before the war began, which is contributing to the stark reality that consumer sentiment is near the trough seen in June 2022.