Dow has best daily gain for year; indexes up sharply for May

US annual PCE inflation rises 2.7% YoY in April
Dell plunges after lower current-quarter profit forecasts
Trump Media falls in choppy trading after Trump conviction
Indexes: Dow up 1.51%, S&P 500 up 0.8%, Nasdaq down 0.01%

NEW YORK, May 31 (Reuters) – The Dow and S&P 500 ended higher on Friday and the Dow registered its biggest daily percentage gain since November 2023 as month-end repositioning drove a late sharp rally, with all three major indexes posting strong gains for May.

Almost all of the major S&P 500 sectors ended higher, with the energy sector

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up 2.5%. The technology sector

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closed slightly in the red.

“We definitely saw a spike in volume toward the end,” said Joe Saluzzi, co-founder and co-head of Equity Trading at Themis Trading in Chatham, New Jersey, noting it was probably related to month-end repositioning.

Volume on U.S. exchanges totaled 14.60 billion shares, compared with the 12.56 billion average for the full session over the last 20 trading days.

The U.S. personal consumption expenditures (PCE) price index increased 0.3% last month, the Commerce Department’s Bureau of Economic Analysis reported, matching the unrevised gain in March. It also showed consumer spending slowed more than expected.

“People were pleased that it wasn’t hotly surprising but also underneath the surface, the consumer continues to show a little bit of strain,” said Carol Schleif, chief investment officer at the BMO family office in Minneapolis.

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Traders of futures tied to the Fed policy rate added to bets of roughly even odds that the central bank will begin to cut rates in September and boosted the chances of a second rate cut in December to about the same probability.

Traders work on the trading floor at the New York Stock Exchange (NYSE) in New York City, U.S., April 5, 2024. REUTERS/Andrew Kelly/File Photo Purchase Licensing Rights, opens new tab

On Friday, the Dow Jones Industrial Average

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rose 574.84 points, or 1.51%, to 38,686.32. The S&P 500

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gained 42.03 points, or 0.80%, at 5,277.51 and the Nasdaq Composite

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lost 2.06 points, or 0.01%, at 16,735.02.

For the month, the S&P 500 rose about 4.8%, the Nasdaq jumped 6.9% and the Dow climbed 2.4%.

Stocks were down for the week, however, with the S&P 500 and Nasdaq breaking five-week winning streaks. For the week, the S&P 500 fell about 0.5%, the Nasdaq declined 1.1% and the Dow fell 0.9%.

On Friday, shares of Dell

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fell 17.9% after it forecast current-quarter profit below market estimates and signaled that higher costs to build servers that meet heavy AI workloads would dent its annual margins.

Among gainers, Zscaler

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jumped 8.5% after the security solutions provider forecast fourth-quarter results above estimates.

Gap

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surged 28.6% after the apparel maker raised its annual sales forecast and its first-quarter results beat market expectations, in fresh signs that its turnaround strategy was starting to work.

Trump Media & Technology Group

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fell 5.3% after a New York jury convicted former President Donald Trump of falsifying documents to cover up a hush money payment to a porn star ahead of the 2016 elections.

Advancing issues outnumbered decliners by a 2.94-to-1 ratio on the NYSE and a 1.51-to-1 ratio on the Nasdaq.

The S&P 500 posted 19 new 52-week highs and six new lows while the Nasdaq Composite recorded 55 new highs and 100 new lows.

Reporting by Abigail Summerville and Caroline Valetkevitch in New York; Editing by Pooja Desai and Richard Chang

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Abigail is on the M&A team and writes about consumer and retail deals. She joined Reuters in 2022 from Debtwire where she covered leveraged finance and the primary debt market for three years. Previously, her work has appeared in the Wall Street Journal, CNBC and the Boston Business Journal. She majored in business journalism at Washington and Lee University.