Stocks climbed on Friday as Wall Street closed a volatile week on a high note despite some disappointing earnings reports.
The Dow Jones Industrial Average gained 748.97 points, or 2.47%, to close at 31,082.56. The S&P 500 rose 2.37% to 3,752.75. The Nasdaq Composite added 2.31% to 10,859.72.
Friday’s moves extended the market’s gains for the week. The S&P 500 and Dow gained 4.7% and 4.9%, respectively, while the Nasdaq rose 5.2%. It was the best week since June for all three major averages.
The advance came despite the 10-year Treasury yield surging to its highest level since 2008 and a mixed bag of corporate earnings reports.
“I think at the end of last week market’s got a little bit oversold technically. And as we’ve seen so many times in the past, when things get negative enough it becomes some sort of a contrarian indicator for a bounce,” said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research.
“But like every other bounce we’ve had, it hasn’t been very well sustained. … A bounce today doesn’t necessarily mean it’s going to continue into next week. If it does, I suspect it won’t be more than a day or two,” Frederick added.
Bank stocks were a bright spot on Friday, with Goldman Sachs gaining 4.6% and JPMorgan Chase adding 5.3%.
Earnings reports limited gains for the market. Dow components American Express and Verizon fell about 1.6% and 4.5%, respectively, after their quarterly reports. In tech, social media company Snap fell 28% after reporting a quarterly revenue of $1.13 billion, below expectations.
Treasury yields fell from their highs on Friday morning after a report from the Wall Street Journal that some Fed officials are concerned about overtightening with large rate hikes. That report appeared to boost equities as well.
The central bank’s aggressive rate hikes have been a major factor in stocks falling into a bear market this year, and traders have continued raising their estimates of where the Fed will stop.
“We really need a Fed pause. Not so much that they would just outright disavow future rate hikes, but that they would just say every meeting is live, and if the data go our way then after the first half of ’23 we don’t have to do more,” said Stifel chief equity strategist Barry Bannister on CNBC’s “Squawk on the Street.”
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