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Last Week’s Market Summary: Dow Jones Falls as Debt Ceiling Negotiations Stall

In last week’s trading session, the Dow Jones experienced a downward trend on Friday (May 19). The morning’s positive momentum faded as negotiations on the US debt ceiling in Washington stalled, undermining hopes for a timely agreement to avoid defaults.

The Dow Jones Industrial Average closed at 33,426.63 points, recording a decline of 109.28 points or 0.33%. Similarly, the S&P500 closed at 4,191.98, down 6.07 points or 0.14%. The Nasdaq also experienced a downturn, closing at 12,657.90 points, down 30.94 points or 0.24%.

Crude oil contracts faced pressure on Friday due to reports of stalled negotiations on the US debt ceiling. WTI crude futures dropped 31 cents or 0.43%, settling at $71.55 a barrel. However, they still managed to close the week with a gain of 2.2%. Similarly, BRENT crude futures decreased by 28 cents or 0.37%, settling at $75.58 a barrel, but still recorded a 1.9% gain for the week.

On a positive note, gold contracts closed higher on Friday as the depreciation of the US dollar stimulated gold purchases. Gold futures rose by $21.80 or 1.11%, reaching a closing price of $1,981.60 per ounce. However, it experienced a weekly decline of 1.9%, the most severe since the beginning of February. Meanwhile, silver futures saw an increase of 42.70 cents or 1.81%, closing at $24.06 per ounce. Platinum futures also rose by $17.50 or 1.65%, settling at $1,075.70 per ounce. Palladium futures experienced the most significant gain, rising by $73.60 or 5.1%, settling at $1,523.80 per ounce.

In foreign exchange markets, the US dollar weakened against a basket of major currencies as investors anticipated the Federal Reserve (Fed) to halt interest rate hikes and due to the stalled debt ceiling negotiations. The dollar index, which measures the greenback against six major currencies, dropped by 0.37% to 103.1924.

The US dollar saw declines against specific currencies as well. Against the yen, it weakened to 138.0760 from 138.6390. It also lost ground against the Swiss franc, dropping to 0.8998 from 0.9050. Similarly, the dollar weakened against the Canadian dollar, falling to 1.3509 from 1.3510. Against the Swedish krona, it fell to 10.5292 from 10.5839. However, the euro experienced a rise against the dollar, reaching $1.0807 from $1.0767, while the pound strengthened to $1.2448 from $1.2404.

Last week’s market performance reflects concerns surrounding the US debt ceiling negotiations and their potential impact on the economy and financial markets. Investors will closely monitor developments in the coming week as they seek clarity on these critical issues.

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