Market Insights

Stocks hit a wall last week as bond yields rose and tariffs worries returned.

The S&P 500 dropped 2.6 percent between Friday, May 16, and Friday, May 23. It was the biggest drop since early April. Every major sector and 86 percent of the index’s members declined. Some chart watchers may see potential resistance at levels from December and earlier this year. (See chart below for more.)

The yield on the 30-year Treasury bond closed above 5 percent for the first time since October 2023 and an auction for 20-year securities drew weak demand. That followed a sovereign credit rating downgrade by Moody’s on May 16. It also comes as lawmakers debate a spending bill that could further widen the fiscal deficit. There was troubling news in Japan as well, with 20-year government yields climbing to levels last seen at the beginning of the century.

Those events are raising worries about high debt levels and the ability of rates to drop over time — even if inflation cools. Investors may see risk to valuations, which are already at historically high levels. It could also challenge the housing market and raise costs for companies needing to refinance debt after borrowing at low rates in recent years.

The other big item last week was President Trump’s suggestion on Friday morning that tariffs on European goods would jump to 50 percent on June 1. He extended the date to July 9 on Sunday to give time for negotiations. Stocks initially fell, but futures recovered after the change. Markets remained closed on Monday for Memorial Day.

American iPhones?

The president also slammed Apple (AAPL) with tariffs of at least 25 percent if the tech giant doesn’t manufacture iPhones in the U.S. Most analysts think such a change would take years and significantly increase the cost of smart phones. AAPL, already stuck at a resistance level from April, dropped 7.6 percent. It was the biggest decline of any company with a market capitalization above $200 billion, according to TradeStation data.

AAPL’s slide weighed on the broader technology sector, which also faced weakness in chip stocks. Solar companies like Enphase Energy (ENPH), another part of the tech index, plunged after lawmakers moved to remove clean-energy credits.

Real estate investment trusts, homebuilders and banks declined as Treasury yields increased.

Energy stocks were the biggest decliners overall last week. The drop partially resulted from a Bloomberg News report that OPEC will consider increasing production at its meeting on Sunday, June 1.

Safe havens were the best performers last week. Gold miners rallied, while consumer staples and utilities declined the least. International stocks inched higher despite weakness in the U.S. Platinum futures (@PL) had their biggest weekly gain in four years.

Some of those moves may suggest investors are continuing to shift capital away from domestic markets. (This post has more on the “sell America” trade.)

Nuclear Reaction

Nuclear-energy stocks had another strong week as the White House issued executive orders to support the industry. The moves, which include a regulatory overhaul and efforts to increase reactors, follow positive earnings reports earlier in May.

GE Vernova (GEV), for example, climbed as the Tennessee Valley Authority looked to build the company’s BWRX-300 next-generation small reactor. That helped make the former General Electric subsidiary the top gainer in the S&P 500 last week.

Other gainers in the nuclear-energy space included Lightbridge (LTBR), Nano Nuclear Energy (NNE), Oklo (OKLO) and NuScale Power (SMR).

Intuit (INTU) jumped to a new record high after earnings, revenue and guidance beat estimates. Analysts at firms including JPMorgan, RBC and KeyBanc raised their target prices, citing AI gains.

Newmont (NEM), the only pure-play gold miner in the S&P 500, climbed as investors returned to precious metals.

U.S. Steel (X) jumped after Trump allowed the company’s sale to Nippon Steel.

Alphabet (GOOGL) was the best-performing megacap after announcing new AI features for its key Search product. The services, powered by Gemini 2.5, will be able to interact with other programs like Gmail and Google Calendar. Analysts applauded GOOGL’s embrace of AI and agentic services.

Fair Isaac (FICO) had its sharpest weekly drop since 1989 after the head of the Federal Housing Finance Agency (FHFA) criticized its fees for credit scores. Equifax (EFX) and TransUnion (TRU) had smaller declines.

Deckers Outdoors (DECK) fell the most since the pandemic after warning higher tariffs will hurt profits. Weak revenue hurt Copart (CPRT).

Charting the Market

The S&P 500 last week reached its highest level since late February, less than 3 percent below its record peak, before stalling.

Chart watchers may think the index is in a range between:

• 5,780: Near the low of January and a peak on March 25.
• 5,971: A weekly close from December 27

They may see reasons for it to break in either direction.

S&P 500, daily chart, with select patterns and indicators.

Bulls may look for the March 25 resistance level to become support. They could also take comfort from prices holding their 200-day moving average.

Bears, on the other hand, may expect more consolidation and deeper pullbacks after the first quarter’s sharp decline. They could notice that last week ended red after making a higher high and lower low. That kind of bearish outside candle is a potential reversal pattern.

They could also worry about intermarket conditions like rising Treasury yields and the falling U.S. dollar. Cboe’s volatility index ($VIX.X) has returned above 20 as well.

The Week Ahead

This week’s calendar features catalysts that could potentially move the market, especially on Wednesday and Thursday. There could also be news from Capitol Hill on the budget and tax-cut bill.

Today’s items — durable-goods orders in the morning and earnings from cybersecurity firm Okta (OKTA) in the afternoon — aren’t likely to have a big impact on the market. (Still, OKTA rallied after its last two reports and is up 57 percent this year.)

Wednesday has two big events in the afternoon:

• Minutes from the last Federal Reserve meeting at 2 p.m. ET
• Earnings from Nvidia (NVDA) after the closing bell. Saleforce.com (CRM) and HP (HPQ) also announce.

Thursday morning has another big event: revised second quarter gross domestic product (GDP). The report includes important inflation data. Initial jobless claims, crude-oil inventories and pending home sales are also due. Thursday’s earnings include Costco (COST), Dell Technologies (DELL) and Best Buy (BBY).

Friday brings the personal consumption expenditures (PCE) inflation report for April.

Biotechnology stocks could also get active with the 2025 ASCO conference starting on Friday, May 30. ASCO, short for the American Society of Clinical Oncology, often features key presentations by drug developers.

OPEC is also scheduled to meet on Sunday, June 1, so there could be energy-related headlines before the event.