-- The Standard & Poor's 500 index rose 3.6% this week in a broad climb ahead of high-stakes peace talks between Iran and the US and the Q1 earnings reporting season.
The S&P 500 ended the week at 6,816.89, its second positive week in a row. The index is up 4.4% for April, erasing much of March's 4.6% drop. It is down 0.4% for the year.
A two-week ceasefire reached between the US and Iran early this week appeared to be holding as officials from Washington and Tehran were expected to meet on Saturday in Pakistan, which helped broker the ceasefire.
The coming week also marks the unofficial start of the Q1 earnings reporting season.
US consumer sentiment hit the lowest on record this month, reflecting heightened worries about higher prices and the overall economic fallout from the Middle East conflict, according to the University of Michigan's preliminary April survey. The survey was largely completed before the announcement of the two-week ceasefire.
A report by the Bureau of Labor Statistics showed US consumer inflation accelerated to its highest monthly reading in nearly four years in March as the Middle East conflict sent energy prices sharply higher. The data showed energy price growth jumped about 11% sequentially in March, led by a 21% surge in gasoline, accounting for nearly three quarters of the headline increase.
Every sector other than energy rose this week. Communication services and consumer discretionary climbed 5.8% each, followed by a 4.8% gain in technology and a 4.7% advance in industrials. Materials were also strong, up 3.5%, while real estate and financials rose more than 2% each. Utilities, consumer staples and health care also edged higher.
Amazon.com (AMZN) was the top performer in consumer discretionary, climbing 14%. The company said its Amazon Web Services' artificial intelligence revenue run rate was more than $15 billion in Q1 and "ascending rapidly." AWS has the potential to grow even faster, Amazon Chief Executive Andy Jassy said in a letter to shareholders.
Paramount Skydance (PSKY) had the largest percentage increase in communication services, rising 12%. The company's $54 billion bridge loan backing its acquisition of Warner Bros. Discovery (WBD), provided by Bank of America (BAC), Citigroup (C), and Apollo Global Management (APO), has been sold down to wider group of banks and reduced to $49 billion, according a regulatory filing.
Intel (INTC) led the advance in the technology sector, jumping 24%. Intel and Alphabet's (GOOG, GOOGL) Google expanded a multiyear agreement to develop artificial intelligence and cloud infrastructure using Xeon processors and custom infrastructure processing units. Intel's Xeon chips will continue to support Google Cloud systems across AI, inference and general computing workloads, the companies said.
Energy, the lone sector in the red for the week, fell 4.1%.
Phillips 66 (PSX) led the energy sector's drop, sliding 9.6%, as the company said its Q1 results are expected to be weighed down by $900 million in mark-to-market losses tied to surging commodity prices, according to preliminary data. The jump in commodity prices also led to a net outflow of almost $3 billion of cash collateral on derivative positions, Phillips 66 said in a regulatory filing.
Earnings reports are expected next week from many large companies, including Goldman Sachs Group (GS), JPMorgan Chase (JPM), Johnson & Johnson (JNJ), Wells Fargo (WFC), Citigroup (C), BlackRock (BLK), Bank of America (BAC), Morgan Stanley (MS), Progressive (PGR), Netflix (NFLX), Pepsico (PEP), Abbott Laboratories (ABT) and Charles Schwab (SCHW).
Economic data will include the March producer price index as well as March existing home sales, import prices, industrial production and capacity utilization, among other reports.