The S&P 500 closed out its best week since June as a report on Thursday showing slowing inflation raised hopes that the Federal Reserve would soon slow its tightening campaign.
The broader market index added 0.9%, to close at 3,992.93. This brought its gain for the week to 5.9%, its best week since the one ended June 24 of this year. The Nasdaq Composite added about 1.9% to end at 11,323.33 as investors snapped up tech shares on hopes interest rates would ease. The Dow Jones Industrial Average gained 0.1%, closing at 33,747.86.
Tech stocks on Friday shook off a decline in cryptocurrencies. Virtual currencies tumbled sharply this week and once again came under pressure Friday after FTX filed for bankruptcy protection, and CEO Sam Bankman-Fried resigned. Bitcoin and ether both declined.
Still, tech stocks and related crypto stocks rebounded after opening lower Friday. The tech sector in the S&P 500 surged 10% through Friday, its best weekly performance since April 2020. Amazon was up more than 4% on Friday, while Google-parent Alphabet was 2.6% higher.
The Dow jumped more than 1,200 points on Thursday following a smaller-than-expected rise in consumer prices for the month of October, giving investors hope that inflation may be cooling. The S&P rose 5.5%, and the Nasdaq Composite surged about 7.4%. It was the best day since 2020 for all three indexes.
Treasury yields plunged Thursday on the back of the weaker-than-expected inflation print. The bond market was closed on Friday to observe Veterans Day.
“From an equity market perspective, as long as the threat of much higher rates is out the way, this should remove a major headwind,” Barclays’ head of European equity strategy Emmanuel Cau wrote in a Friday note.
All of the indexes posted a winning week. The Dow was up 4.1% on a weekly basis, while the Nasdaq Composite advanced 8.1%. The week marked a resumption of a comeback rally for the bear market, which began in mid-October.
Read More: Nasdaq adds 1.9%, S&P 500 closes nearly 1% higher and notches best week since June