On Friday, Wall Street finished the day in positive territory, with all three primary indexes recording weekly advances, as investors found reassurance in data indicating strong economic performance in the largest economy globally.
A gauge of business activity surged to a 31-month peak in November, driven by optimism for reduced interest rates and more business-friendly initiatives anticipated from President-elect Donald Trump’s administration next year.
The small-cap Russell 2000 index, which concentrates on domestic companies, outshone larger-cap indexes, rising by 1.8%. The index gained 4.3% over the week, reaching its highest level in over a week.
In contrast, Alphabet saw a decline of 1.7% following a 4% drop on Thursday, as the U.S. Department of Justice contended in court that the company was monopolizing the online search market.
Nvidia, a leader in AI technology, also dropped 3.2% amid volatile trading after its quarterly forecast was announced on Wednesday.
An index tracking S&P 500 value stocks experienced a rise of 0.78% as investors shifted their focus away from growth stocks.
“I’ve been anticipating this transition in leadership from technology to other sectors. I believe we might be experiencing that change. Small caps are performing significantly better, and value stocks are also showing improvement,” Mark Hackett, Chief of Investment Research at Nationwide, commented.
The Dow Jones Industrial Average added 426.16 points, or 0.97%, reaching 44,296.51, the S&P 500 increased by 20.63 points, or 0.35%, to 5,969.34, and the Nasdaq Composite advanced by 31.23 points, or 0.16%, to 19,003.65.
Industrial stocks led the S&P with a rise of 1.36%, while the consumer discretionary sector was the largest decliner, decreasing by 0.69%.
Weekly performance saw the S&P 500 up by 1.68%, the Nasdaq up by 1.73%, and the Dow up by 1.96%.
Expectations regarding the Federal Reserve’s forthcoming policy decision in December have been fluctuating between a pause and a reduction, as investors consider how Trump’s proposals might influence price levels.
According to the CME Group’s FedWatch Tool, there is a 59.6% chance that the central bank will decrease borrowing costs by 25 basis points.
This week, geopolitical issues were a significant concern as investors kept an eye on a missile exchange between Ukraine and Russia, especially after Moscow lowered its threshold for nuclear response. The markets are also awaiting Trump’s pick for Treasury Secretary.
“The fact that we’ve maintained a calm and steady upward trajectory is very reassuring and indicates that investors aren’t acting impulsively despite the numerous uncertainties we’ve encountered,” Hackett remarked.
In corporate news, Gap Inc soared by 12.8% after the parent of Old Navy lifted its annual sales outlook and noted a “strong start” to the holiday season.
In contrast, Intuit fell 5.7% after Thursday’s projection indicated second-quarter revenue and profit would fall short of Wall Street’s expectations.
On the NYSE, advancing stocks outnumbered declining ones by a ratio of 3.2-to-1, with 532 reaching new highs and 41 new lows.
The Nasdaq saw 3,076 stocks rise versus 1,271 that fell, resulting in a 2.42-to-1 ratio of advancing to declining issues.
The S&P 500 recorded 83 new 52-week highs and one new low, while the Nasdaq Composite noted 179 new highs and 85 new lows.
U.S. exchange volume totaled 13.49 billion shares, compared to an average of 14.65 billion over the last 20 trading days.
