The S&P 500 ended the week down 0.4%, still roughly 8% off its February peak. Price action reflected indecision, as resilient earnings clashed with geopolitical uncertainty. While growth sectors lagged, a modest bid in cyclicals and defensives suggested investors are balancing risk and caution rather than pulling out altogether.
This fragile détente has lowered immediate risk but offers little confidence in a sustained resolution. Traders remain alert to headlines, especially those hinting at tariff escalation or supply chain disruptions.
This curve move suggests markets are pricing in longer-term inflation concerns, not growth optimism. Fixed income desks are watching for potential curve trades if this steepening continues.
Earnings strength has supported valuation levels and tempered fears of a sharp equity correction, even as growth sectors deal with multiple compression.
The benchmark S&P 500 Index is likely to remain in a choppy range near current levels, with earnings and select cyclicals providing support while macro risks limit upside. The base case remains a slow, earnings-supported grind higher toward 6,000, assuming no sharp deterioration in trade or inflation data. However, near-term upside is capped unless there’s a policy shift from the Fed or concrete progress in trade negotiations.
More Information in our Economic Calendar.
James Hyerczyk is a U.S. based seasoned technical analyst and educator with over 40 years of experience in market analysis and trading, specializing in chart patterns and price movement. He is the author of two books on technical analysis and has a background in both futures and stock markets.