WASHINGTON (dpa-AFX) - After turning in a strong performance throughout much of the session on Friday, stocks gave back some ground in the latter part of the trading day but still closed mostly higher.
While the major averages pulled back well off their best levels of the day, the Dow still ended the session at a new record closing high.
The Dow advanced 294.04 points or 0.6 percent to 50,589.70, the S&P 500 climbed 27.75 points or 0.4 percent to 7,473.47 and the Nasdaq rose 50.87 points or 0.2 percent to 26,343.97.
For the week, the Dow surged by 2.1 percent, the S&P 500 jumped by 0.9 percent and the Nasdaq increased by 0.5 percent.
The strength seen for most of the day came amid persistent optimism about an end to the U.S.-Iran war even as crude oil and gasoline prices remain elevated going into the busy Memorial Day weekend.
However, buying interest waned late in the session, as traders may have looked to cash in on recent gains ahead of the long weekend.
In remarks to reporters on Thursday, Secretary of State Marco Rubio claimed the U.S. and Iran have made 'some progress' in negotiations to end the war.
Rubio also said there have been 'some good signs' but cautioned he doesn't want to be 'overly optimistic' and noted President Donald Trump has been clear he has 'other options' if the U.S. and Iran can't get a 'good deal.'
One of the sticking points seems to be Iran's efforts to establish a tolling system for the Strait of Hormuz, which Rubio called 'unacceptable' and said 'would make a diplomatic deal unfeasible.'
Rubio's comments come as reports from Iranian state media suggest the latest U.S. peace proposal has narrowed some of the gaps between the two countries.
Meanwhile, traders largely shrugged of a report from the University of Michigan showed consumer sentiment in the U.S. deteriorated by much more than previously estimated in the month of May.
The University of Michigan said its consumer sentiment index for May was downwardly revised to 44.8 from a preliminary reading of 48.2. Economists had expected the index to be unrevised.
With the unexpected downward revision, the consumer sentiment index is down sharply from 49.8 in April, hitting its lowest reading on records going back to 1952. The report also showed increases in both year-ahead and long-run inflation expectations.
Surveys of Consumers Director Joanne Hsu noted the consumer sentiment index fell for the third straight month as supply disruptions in the Strait of Hormuz continue to boost gasoline prices.
'The cost of living continues to be a first-order concern, with 57% of consumers spontaneously mentioning that high prices were eroding their personal finances, up from 50% last month,' Hsu said.
She added, 'Critically, consumers appear worried that inflation will increase and proliferate beyond fuel prices, even in the long run.'
Sector News
Computer hardware stocks extended the rally seen in the previous session, with the NYSE Arca Computer Hardware Index soaring by 6.1 percent to a record closing high.
The index added to the 4.9 percent spike on Thursday after the Commerce Department announced the signing of 9 letters of intent to provide $2.0 billion in federal incentives to a portfolio of quantum computing companies.
Substantial strength was also visible among networking stocks, as reflected by the 3.2 percent surge by the NYSE Arca Networking Index, which also reached a new record closing high.
Airline, semiconductor and steel stocks also saw significant strength on the day, while gold and brokerage stocks showed notable moves to the downside.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index surged by 2.7 percent, while China's Shanghai Composite Index advanced by 0.9 percent.
The major European markets also moved to the upside on the day. While the German DAX Index jumped by 1.2 percent, the French CAC 40 Index climbed by 0.4 percent and the U.K.'s FTSE 100 Index rose by 0.2 percent.
In the bond market, treasuries fluctuated over the course of the session before closing in positive territory. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell 2.8 basis points at 4.558 percent.
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