Stock market defies May slump, signals strong gains likely through summer 2025

The stock market has defied the traditional May slump, signaling strong gains likely through summer 2025. The S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all posted gains, buoyed by optimism over U.S. trade talks and President Donald Trump's decision to double tariffs on imported steel and aluminum.

The Dow Jones rose 35.41 points, or 0.08%, to 42,305.48; the S&P 500 gained 24.25 points, or 0.41%, to 5,935.94; and the Nasdaq Composite increased 128.85 points, or 0.67%, to 19,242.61.

Shares of U.S. steel companies surged, led by Cleveland-Cliffs with a 23% jump, while other steel-makers like Nucor and Steel Dynamics also saw gains. This rally was further supported by a 1.5% surge in chipmakers, reflecting improving stock-market breadth, a typically bullish indicator according to Wall Street analysts.

"Stock-market breadth is improving. That’s typically a bullish indicator," analysts noted.

The market's resilience comes after April's tariff-induced volatility, with many investors surprised by the rapid rebound. The old adage to "sell in May and go away" appears outdated as the market shows signs of sustained strength.

"The old adage that investors should ‘sell in May and go away’ is already looking like a bust," experts say, suggesting the positive momentum could continue through summer 2025.

Despite a slight dip in U.S. ISM manufacturing PMI for May at 48.5 versus a 49.3 forecast, investor confidence remains high, driven by trade optimism and strong sector performances.

Overall, the market's unexpected strength and improving breadth point to a bullish outlook, defying seasonal trends and tariff concerns.

The stock market defied the traditional May slump, with the S&P 500, Dow Jones, and Nasdaq all posting gains amid optimism over U.S. trade talks and tariff moves. Analysts see improving market breadth and a strong rally in chipmakers, signaling potential gains through summer 2025.