Traders work on the floor of the New York Stock Exchange on July 22, 2024.
Spencer Platt | Getty Images
Stocks jumped on Friday as Wall Street sought to end a turbulent week on a positive note as investors weighed fresh U.S. inflation data.
the Dow Jones Industrial Average 3M shares rose about 800 points, or nearly 2%, sending the company’s stock soaring. The industrial giant’s stock rose about 20% and was on track for its best day since at least 1972. Standard & Poor's 500 It rose 1.5%, along with Nasdaq Composite.
Friday's moves stemmed from a combination of oversold sentiment, a stronger-than-expected GDP report on Thursday and the view that the Federal Reserve will start cutting interest rates due to economic resilience, said Sam Stovall of CFRA Research.
“Today's positive personal consumption spending report helped calm the market. With this decline, the large rotation continues and supply remains in our favor,” he added.
Investors continued to shift toward cyclical areas of the market and small-cap companies, with the Russell 2000 up about 2%. Industrials and materials stocks also rose, lifting their respective sectors of the S&P 500 by about 2%.
Shares of some of the tech companies that struggled amid last week’s selloff rose, with Nvidia, Microsoft and Amazon each up about 2%. Meta Platforms rose about 3%. The S&P 500’s information technology sector rose about 1.8%.
Wall Street also weighed in on the June personal consumption expenditures price index, the inflation reading favored by central bank policymakers. On a monthly basis, the PCE index rose 0.1% and was up 2.5% from a year earlier. That was in line with economists surveyed by Dow Jones.
The positive inflation news has boosted investors' hopes for more rate cuts this year, with the Fed funds futures market pricing in cuts in September, November and December.
“The numbers have become less severe,” said Ken Mahoney, president of Mahoney Asset Management. “In housing and real estate, we’re starting to see some cracks. They’re going to stop messing around and start cutting rates.”
The data comes at the end of a volatile week on Wall Street. The S&P 500 fell 0.4% this week, while the Nasdaq lost 1.7%. The Dow Jones was an exception, rising 1.1%. The declines come as investors appear to be part of a broader cycle toward small-cap and cyclical stocks.
SPX 5-Day Chart
In other news, medical device maker Dexcom Shares of the shoe company fell 41% after issuing disappointing guidance for the full fiscal year. Deckers Apple Inc. reported first-quarter earnings and revenue that beat analysts' expectations, sending its shares up 8%.
