Stock Market Close: May 2, 2025

U.S. markets closed sharply higher on Friday, May 2, as investor sentiment was buoyed by strong labor data and political pressure on the Federal Reserve to lower interest rates. The Dow Jones Industrial Average surged 564 points (+1.39%) to close at 41,317.4, while the Nasdaq Composite gained 267 points (+1.51%) to end at 17,977.7. The S&P 500 rose 82.53 points (+1.47%) to finish at 5,686.67, and the Russell 2000 led gains with a 2.26% jump to 200.50.

Market optimism was fueled by a resilient April jobs report showing nonfarm payrolls rose by 177,000 and unemployment remained steady at 4.2%—a sign of continued economic strength despite ongoing trade tensions. Sectors like healthcare and transportation saw notable job growth, while tech stocks such as microsoft have soared in 2025 amid AI-driven demand.

Adding to the day's momentum, former President Donald Trump posted on Truth Social urging the Fed to cut interest rates, citing falling gas prices, strong employment, and a lack of inflation. However, Fed Chair Jerome Powell reiterated a cautious stance after the April FOMC meeting, holding rates steady at 4.25–4.5% and emphasizing a data-driven approach amid tariff-related uncertainties.

Despite political pressure, the Fed remains focused on persistent inflation—core PCE stands at 2.6%—and volatility in GDP, which contracted by 0.3% in Q1 due to import surges ahead of tariffs. Still, Wall Street found comfort in the labor market’s stability, lifting all major indexes into the green.