US stocks closed higher on Friday, with the Dow Jones Industrial Average rising by 0.7%. Market attention was centered on potential US-Iran negotiations and the highly anticipated public debut of SpaceX.

The Dow increased by 353.51 points, or 0.70%, to close at 51,202.26. The Nasdaq Composite gained 79.18 points, or 0.31%, finishing at 25,888.84. The S&P 500 index advanced by 37.16 points, or 0.50%, ending the session at 7,431.46.

Global equity markets also moved higher on Friday. Japan's Nikkei 225 index surged 2.8%, India's Nifty 50 rose 1.3%, and South Korea's Kospi jumped 4.6%. China's Shanghai Composite index gained over 1%. In Europe, the Stoxx 600 index climbed 1.7%.

Reports emerged Friday, citing informed sources, suggesting a peace agreement between the United States and Iran could be signed as early as Sunday in Switzerland.

Iranian state media reported that a draft memorandum of understanding includes a US commitment to lift oil sanctions and an Iranian pledge to reopen the Strait of Hormuz.

Iranian Foreign Minister Abbas Araghchi posted on X, stating that the Islamabad memorandum was "closer than ever." He indicated details would be released "at the appropriate time" and urged media to "refrain from speculating on its contents before finalization."

This followed a market rally on Thursday, fueled by a rebound in chip stocks and comments from former US President Donald Trump hinting that a peace deal with Iran was imminent.

On Friday, Elon Musk's SpaceX made its highly anticipated debut on the Nasdaq under the ticker SPCX. It began trading with a market capitalization exceeding $2 trillion, surpassing its prior valuation of $1.77 trillion and ranking it among the top ten most valuable US-listed companies.

The company plans to issue 555.6 million shares, aiming to raise $75 billion, which would make it the largest initial public offering in history. This scale is more than triple the size of Alibaba's $22 billion IPO in 2014, which currently holds the record for the largest US IPO.

At the time of reporting, SpaceX shares were up $34.86, or 25.82%, trading at $169.86, pushing its market value above $2.2 trillion.

However, some investors expressed concern that the massive size of the SpaceX offering could exert pressure on the broader market.

Analysts noted that even if the market absorbs the new shares, IPOs are inherently volatile, and Friday's listing could trigger another rotation in market leadership away from technology stocks as investors raise capital to subscribe to the new issue.

Douglas Borthwick, Global Equity Strategist at Wells Fargo Investment Institute, stated, "History shows that mega-IPOs often occur during periods of strong market sentiment, but the additional equity supply can lead to indigestion. US household equity allocations are already near historical highs, meaning they may need to sell existing holdings to fund these new positions."

"Coupled with ongoing geopolitical tensions and the approaching midterm elections, this could be another reason for increased market volatility in the second half of the year," he added.

He further commented, "We remain constructive on the AI theme and the information technology sector but would not chase this recent rally." He pointed out that as of May 29th, the sector had risen 37% since April, compared to a 17% gain for the S&P 500 over the same period.

Thursday's gains pushed the S&P 500 and Nasdaq Composite back into positive territory for the week, with weekly increases of 0.14% and 0.39%, respectively. The blue-chip Dow Jones Industrial Average underperformed, on track for a weekly decline of 0.04%.