Wall Street capped a choppy week of trading with a broad stock market rally Friday, as the S&P 500 notched its fourth consecutive weekly gain.
The benchmark index closed 1.7 per cent higher, for a 3.3 per cent weekly gain. The S&P 500 hadn’t posted such a good stretch since November.
The Dow Jones Industrial Average rose 1.3 per cent, while the Nasdaq and Russell 2000 index of smaller companies both closed 2.1 per cent higher. Each index also posted a solid weekly gain. The Australian sharemarket is set for a bright start to the session on Monday, with futures pointing to a rise of 39 points, or 0.6 per cent.
Technology stocks drove much the rally. Crude oil prices fell and bond yields were mixed.
Trading was choppy much of the week, but major indexes got a big bump on Wednesday after a report showed that inflation cooled more than expected last month. Another report on Thursday showed inflation at the wholesale level also slowed more than expected.
The cooler-than-expected inflation readings have bolstered hopes among investors that inflation may be close to a peak and that the Federal Reserve could less aggressively hike interest rates, its main tool for fighting inflation.
“The data that we’ve gotten this week has all been consistent with the idea that we’re in the midst of peak inflation rates on a month-to-month basis,” said Scott Ladner, chief investment officer at Horizon Investments. “And that’s something that we’ve been waiting to see for months now. And it looks like, if that’s the case, then we’ve probably also seen peak Fed hawkishness.”
The S&P 500 rose 72.88 points to 4,280.15, while the Dow gained 424.38 points to 33,761.05. The Nasdaq added 267.27 points to 13,047.19.