S&P 500 Closes at Record as Trump Peace Comments Lift Stocks

The S&P 500 closed at a fresh record high on Thursday, buoyed by President Donald Trump's optimistic comments on peace negotiations in Lebanon and a drop in oil prices. The Dow Jones Industrial Average also rose, while the Nasdaq Composite edged lower as a sharp decline in Broadcom shares weighed on the tech-heavy index. The S&P 500's gain reflects broad-based buying, with 9 of 11 sectors finishing higher, led by energy and financials. The Dow added 150 points, while the Nasdaq slipped 0.1% as Broadcom tumbled 7% after reporting disappointing guidance.

Trump stated that "progress has been made" and that "things will happen over there," fueling a broad market rally that reversed earlier losses. The positive sentiment was reinforced by falling oil prices, which eased inflation concerns and supported risk appetite. For interest rate traders, the rally in equities and the drop in oil suggest a potential easing of geopolitical risk premiums, which could reduce safe-haven demand for bonds and keep yields elevated. The 10-year Treasury yield rose 4 basis points to 4.35%, as markets recalibrate expectations for Federal Reserve policy. The Fed's dual mandate of price stability and maximum employment remains in focus, with the yield curve steepening as short-term rates stay anchored by rate-cut bets while long-term yields rise on term premium and supply concerns. The drop in oil, if sustained, could lower headline inflation and support the case for rate cuts later this year, but the labor market's resilience complicates the outlook. Live rates and charts on NowPrice show how the market is reacting to these developments in real time.

Looking ahead, traders will focus on upcoming economic data, including the monthly jobs report, for further clues on the Federal Reserve's policy path. The resilience of the S&P 500 despite Broadcom's plunge is seen as a bullish signal, but the sustainability of the rally will depend on continued progress in peace talks and inflation trends. A strong jobs report could push yields higher, while a weak print might revive rate-cut expectations. Additionally, the ECB's transmission protection instrument remains a backstop for European spreads, but U.S. swap spreads have widened, indicating lingering stress in funding markets. The balance sheet runoff continues to drain reserves, and any signs of liquidity strain could prompt the Fed to slow the pace. For now, the market is pricing in a 60% chance of a rate cut by September, but that could shift rapidly with the next data release.