U.S. stocks rose on Friday as Wall Street searched for a recovery from the Dow Jones Industrial Average’s biggest sell-off in a year.
The S&P 500 (^GSPC) rose about 0.3%, and the tech-heavy Nasdaq Composite Index (^IXIC) added about the same amount. The blue-chip Dow Jones Industrial Average (^DJI) rose about 0.1%, or about 50 points.
Resurgent concerns about interest rates led to a selloff in stocks on Thursday, with the Dow Jones Industrial Average falling more than 600 points, while U.S. Treasury yields rose, with the benchmark 10-year Treasury yield (^TNX) hovering around 4.5%.
The euphoric mood turned sour after better-than-expected U.S. corporate data prompted the Federal Reserve to rethink the direction of interest rate policy.
Traders are roughly evenly split on whether the Fed will cut rates at its September meeting, according to the CME FedWatch tool. That’s a big change from a few days ago, when only about a third expected the Fed to keep rates on hold at its first meeting of the fall. Goldman Sachs said Friday it no longer expects the Fed to make its first rate cut in July, suggesting September is most likely.
But Wall Street may be heading into the holiday weekend in a good mood. Nvidia (NVDA), whose shares surged early Thursday on its latest strong quarterly results, was up just under 1% on Friday, trading around $1,040 a share. An upcoming stock split could spur more retail investor interest in the company’s shares.
The macroeconomic highlight on Friday was the revised University of Michigan consumer confidence index for May. Previous releases had shown the index fell sharply this month as worries about inflation and interest rates weighed on Americans’ views of the economy.
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