WASHINGTON (TNND) — After the S&P 500 reached a record high on Thursday, rising to 6,501.86, the S&P 500 has now dropped .2% on Friday, but its on pace to close August 2% higher than in July, making for a fourth winning month in a row.

The greater contributor to the S&P hitting record highs on Thursday comes from the stock earnings of Nvidia, a large artificial intelligence company, which were up 6% from the previous quarter and up from 56% a year ago. The company’s growth is driven by its investments in its data centers. Capital Economics chief North America economist Paul Ashworth noted that the S&P performance on Thursday reveals “increasingly concrete signs of an AI-related boom in tech investment.”

The stock market’s strength coincides with a boost in the country’s GDP which is mainly attributed to strong consumer spending and increased investments made in artificial intelligence. In the second quarter of the year, amid President Donald Trump’s implementation of his “Liberation Day” tariffs and his ongoing trade negotiations, there was a 3.3% growth in GDP with net exports adding 5% to points the GDP.

“With GDP running at 3.3%, the economy appears to be on all cylinders, and it should be a boost of confidence to markets that most of the tariff-angst was misplaced earlier this year,” Chris Zaccarelli, chief investment officer for Northlight Asset Management, said in a note.

In the first quarter, the GDP saw a .5% drop, the first dip in the GDP since 2022. Combining the first and second GDP readings, the GDP has grown just an average of 1.4% in the first half of 2025.

Meanwhile, GDI, or growth domestic income which measures the net income earned by residents and businesses saw a 4.8% increase in the second quarter after recording .2% pace in the first quarter.

As for third quarter growth, economics protect it to be more stable.

“Economic growth will likely flatline in the third quarter,” Jeffrey Roach, chief economist for LPL Financial wrote in a note. ” Softer growth in Q3 will add fuel to those calling for rate cuts.”

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