Wall Street closed another volatile week with a broad rally on Friday, but that wasn’t enough to sustain the market in its sixth straight week of declines since 2011.
The S&P 500 rose 2.4%. More than 90% of companies included in the benchmark index ended higher. The Nasdaq rose 3.8% as further gains in tech companies helped boost the tech-focused index. The Dow Jones Industrial Average rose 1.5%.
The bullish close resulted in the index still posting weekly losses of more than 2.4% each, the S&P 500 and Nasdaq extended their weekly decline to six weeks and the Dow lost seven weeks in a row.
The market has been on a downward trend since the end of March. Traders’ concerns The Fed may not succeed On a delicate mission to slow the economy enough to contain the highest inflation in 40 years without causing a recession.
After a sudden rally, with the S&P 500 rising 2.5% at the end of April and 3% at the beginning of May, the market continued its decline after hitting an all-time high at the beginning of the day. year.
This is not an unusual pattern on Wall Street when the index is almost entering a bear market or falling more than 20% from its most recent high. The closest day for the S&P 500 to bear market this year was Thursday, down 18.1% from its January highs.
“If you look back at how the bear market unfolds, it’s showing pretty good rallies, every day, all day, not all at once until the end,” said Tom Martin, senior portfolio manager at Globalt Investments. “This could be one of those big rallies that get you to rebound to some extent before the market goes down again.”
The S&P 500 rose 93.81 points to close at 4,023.89. The index has fallen 15.6% so far this year. The Dow rose 466.36 points to close at 32,196.66, and the Nasdaq closed at 11,805, up 434.04 points.
Small and mid-cap stocks also showed a solid uptrend. Russell 2000 rose 53.28 points, or 3.1%, to close at 1,792.67.
Twitter Tesla’s stock fell 9.7% after Tesla CEO Elon Musk said he would put a hold on social media acquisitions. Tesla rose 5.7%.
Companies are struggling to keep up with the growing demand for a variety of products and commodities in supply chain and production challenges. They have been raising prices for food, clothing and most other commodities, which is putting pressure on consumers and raising concerns about declining spending and slowing economic growth.
Fed is trying to mitigate the effects of higher inflation by pulling its benchmark short-term rates from the near-zero lows that spent most of the pandemic. They also said they could continue to raise rates up to twice the usual rate at the next meeting. Investors are concerned that if the central bank raises interest rates too high or too quickly, it could cause a recession.
The Department of Labor released a report this week identifying persistently high consumer and wholesale prices affecting businesses.
Jay Hatfield, CEO of Infrastructure Capital Advisors, said, “The Fed’s tightening policy has a lot of problems and rising inflation isn’t the biggest market situation, but at some point it comes down to price.
Meanwhile, China’s decision to close major cities Supply chains are under further pressure amid concerns over a re-spread of COVID-19, Russian invasion of Ukraine Already high energy and food costs have increased worldwide.
Technology stocks led the gains on Friday. Apple rose 3.2% and Microsoft 2.3%. The sector has been behind extensive market volatility throughout this week and slipped across the board as investors prepare for higher interest rates that tend to put the most pressure on the most expensive stocks.
Retailers and telecommunications companies also benefited solidly. Amazon rose 5.7% and Google’s parent company rose 2.8%.
Bond yields rose significantly. The 10-year Treasury yield rose to 2.93% from 2.82% late Thursday.
The price of US crude oil rose 4.1% to $110.49 a barrel. It has increased by about 50% this year.
Investors are also focusing on recent corporate earnings to gain more insight into how inflation affects businesses and consumers. Several major retailers, including Walmart, Target and Home Depot, will report their results next week.
Bitcoin stabilized around $30,000 late Friday. dropping At around $25,420 earlier this week, according to CoinDesk, it is the lowest level since December 2020. Just six months ago, it was over $66,000.