Stock Market Update Thursday May 22, 2025
- AlgoTradeAlert
- May 22
- 4 min read
Stock Market Update Thursday May 22, 2025 U.S. equity markets struggled to find direction on Thursday, with stocks chopping sideways following the steep selloff seen in the previous session. The S&P 500 closed marginally lower by 0.04%, reflecting investor hesitation amid heightened volatility. The Nasdaq-100 managed to post a modest gain of 0.15%, supported by selective strength in large-cap tech, while small caps, represented by the Russell 2000 (IWM), slipped 0.05%, underscoring risk aversion in more economically sensitive sectors.
Away From Stocks: In the bond market, long-duration Treasurys saw a tepid rebound, as the yield on the 30-year note dipped three basis points to 5.05%. The move signaled some defensive positioning, although appetite for duration remained constrained by persistent inflationary pressures and uncertain monetary policy outlooks. Commodities delivered a mixed performance. WTI crude oil extended its decline, falling below $61 per barrel as global demand concerns continued to weigh on sentiment. Gold retreated to $3,293 per ounce, likely pressured by a stronger U.S. dollar and a shift away from safe-haven assets. Meanwhile, bitcoin broke above the $111,000 threshold, reflecting speculative momentum and growing institutional interest. Volatility remained elevated, with the CBOE Volatility Index (VIX) settling just above the 20 level, suggesting that investor caution has yet to abate.
Yesterdays weak Treasury auction briefly pressured equity markets, the impact was fleeting. Yields are trending higher, largely due to an elevated inflation risk premium, our research shows that rates will peak soon and are likely to retreat toward 3.50% later this year, providing a supportive backdrop for equities.
The Federal Reserve remains in a policy pause, but a dovish pivot could materialize next year. The year 2026 appears increasingly constructive for equities, supported by expectations of reduced trade friction, prospective tax cuts, deregulatory measures, accommodative monetary policy, and improved geopolitical visibility. A so-called “Trump Put”—a perceived market backstop tied to policy expectations—may also bolster market confidence.
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