Cisco Systems led the Dow, surging 6.3% after beating third-quarter earnings estimates and raising its annual forecast. The company also announced a CFO transition, which was well received by investors. Amgen and IBM added further support, each gaining over 3%. These moves helped offset weakness in other parts of the index.

UnitedHealth Group dragged heavily on the Dow, falling 15% to a five-year low. The Wall Street Journal reported the DOJ is investigating the insurer for potential Medicare fraud. Although UnitedHealth stated it has not been notified of such a probe, investor concerns mounted. The drop also pressured other health insurers like Humana and Molina Healthcare.

Investor confidence has strengthened following a temporary truce in the U.S.-China trade dispute, reached after recent talks between Treasury Secretary Scott Bessent and Chinese officials. Major tech names like Nvidia and Tesla, each up over 13% this week, helped lift the Nasdaq 6% week-to-date. The S&P 500 and Dow are up 3.9% and 1.7%, respectively, so far this week.

April's Producer Price Index unexpectedly declined by 0.5%, defying expectations of a 0.3% increase and signaling easing input costs. Retail sales rose just 0.1%, in line with forecasts, while industrial production dipped more than projected. Meanwhile, Walmart fell 1.1% after warning that tariffs could drive prices higher, despite topping earnings estimates. The retailer did not issue Q2 guidance, adding to concerns.

While this week's rally reflects optimism over de-escalating trade tensions, uncertainty remains. The Federal Reserve has signaled a potential reassessment of inflation and employment benchmarks, suggesting caution.

Traders will focus on incoming inflation data and any shifts in Fed commentary for clues on rate policy, particularly as tariff implications ripple through earnings and consumer prices.