Hey moomooers,

Good evening. Here is the latest Market Recap for you.

• The Dow and S&P 500 both closed the month higher, marking its fourth monthly gain in a row.

• Behind the broader market rally, small-cap stocks are showing their strength while meme stocks roar back to life.

• The U.S. market will be closed on Monday to observe Memorial Day.

How did major indexes fare?

• U.S. stocks closed higher Friday, booking weekly gains with support from data confirming an economic recovery from the pandemic, despite inflation running at its highest annual rate in about 13 years.

The $Dow Jones Industrial Average(.DJI.US)$ gained 65 points, or 0.2%, while the  $S&P 500 index(.SPX.US)$ and the $Nasdaq Composite Index(.IXIC.US)$ both advanced 0.1%. 

• Weekly and monthly changes
  

The $Dow Jones Industrial Average(.DJI.US)$ booked a weekly gain of 0.9% for a rise of 1.9% in May, marking its fourth monthly gain in a row.

The $S&P 500 index(.SPX.US)$ was up 1.2% on the week for a May gain of 0.6%, also marking its fourth straight monthly advance.

The $Nasdaq Composite Index(.IXIC.US)$ had a weekly gain of 2.1%, but a 1.5% decline in the month to date.

• The U.S. market will be closed on Monday to observe Memorial Day. 

What drove the market?

U.S. equity market investors closed out May with major indexes near all-time highs, after Wall Street sorted through the latest economic data, along with news of Biden's $6 trillion budget proposal.

• PCE inflation rate to the highest level since 2008

The U.S.'s PCE inflation rate approached its highest level in nearly 13 years at 3.6%, higher than the 2.9% that economists' surveyed by Dow Jones had forecast. That marks the highest level since 2008. On a month-over-month basis, PCE inflation rose 0.6% in April, while the core rate up rose 0.7%.

That reading on inflation comes as U.S. consumer incomes dropped 13.1% in April after government stimulus checks for Americans ended, but consumer spending climbed 0.5% last month, matching consensus estimates.

• Small-cap stocks with momentum boosted by economic growth outlook

The Russell 2000 saw a weekly return of 2.4% and a monthly gain of 0.1%, which marks its eighth straight monthly gain and its longest such winning streak since 1995.

Traders focused on the outlook for higher spending that could boost growth even though some investors were worried about the risks of inflation accompanied by the recorded PCE inflation rate.

• Market opinions on recorded PCE inflation rate

The [personal consumption expenditures] is not market moving today. Inflation is here and it is widespread, it is not a debate.

-Peter Boockvar, chief investment officer of Bleakley Advisory Group

Stocks continue to rise since the U.S. economic growth ‘exceptionalism story’ does not appear to be going away anytime soon, and as inflation still looks like it will be transitory.

-Edward Moya, senior market analyst at Oanda Corp., wrote in a note to clients.

Which stocks were in focus?

• $AMC Entertainment Holdings Inc(AMC.US)$ cooled off after the movie-theater company more than doubled this week. 

Investors shorting the meme stock AMC Entertainment are estimated to have lost $1.23 billion over the last week as the shares rallied more than 116% since Monday, according to data from S3 Partners.

AMC was the most active stock on the New York Stock Exchange by far on Friday as more than 650 million shares changed hands. Its 30-day trading volume average is just above 100 million shares, according to FactSet.

• $Veeva Systems Inc(VEEV.US)$ stock soared over 10%, on pace for largest percent increase since May 30, 2019, when it rose 14.73% after earnings surprises on Thursday.

Veeva Systems is a provider of cloud-based software solutions for the global life sciences industry. 

Veeva Systems reported quarterly earnings of $0.91 per share which beat the analyst consensus estimate of $0.78 by 16.67 percent, up 37.88% YoY. The company reported quarterly sales of $433.60 million which beat the analyst consensus estimate of $410.03 million by 5.75 percent, up 28.62% YoY. 

• $Salesforce.com Inc(CRM.US)$ stock rose 5.4% after reporting earnings of $1.21 a share, beating forecasts for 88 cents a share, on sales of $5.96 billion, above expectations for $5.89 billion. 

• $Ulta Beauty Inc(ULTA.US)$  stock gained 5.2% after reporting a profit of $4.07 a share, beating forecasts for $1.95 a share, on sales of $1.9 billion, above expectations for $1.6 billion.