5-29-25-SPX

The markets have calmed down and are trading in a normal manner. The trend is up, and pullbacks should be shallow and buyable. Good breadth is an important hallmark of healthy uptrends and supports our contention that relative strength breakouts should be bought.

Both SPX and QQQ will likely find resistance near February highs that allows for consolidation in late June ahead of a push back to new all-time highs.

Good news on Nvidia. Nvidia reported better-than-expected earnings and revenue on Wednesday, as the company’s booming data center business recorded year-over-year growth over 73%. The stock rose about 4% in extended trading. Overall revenue grew by 69% during the quarter, and sales in the company’s data center division, which includes AI chips and related parts, grew 73%.

The Consumer Price Index (CPI) picked up a slightly smaller-than-expected 0.2% in April, showing little impact of tariffs over the course of the month. The biggest contributor was shelter, which rose 0.3%, accounting for more than half of the total CPI gain. Energy prices rebounded 0.7%, as costlier natural gas and electricity more than offset cheaper gasoline. In contrast food prices slipped 0.1%, down for the first time since July 2020.

The Conference Board’s Consumer Confidence Index jumped 12.3 points in May to a higher-than-expected reading of 98.0. It was the first increase in six months and the biggest gain in nearly four years. It came on the heels of the U.S./China trade war truce, which alleviated some of consumers’ concerns about the tariff impact on economic growth and inflation. The recovery in stock prices also likely boosted confidence, particularly among high-income earners.