US stocks jumped 2.5 percent on Friday, joining a global rally after surprise stimulus measures by the Bank of Japan (BOJ) raised confidence of further central bank moves to boost growth.
The Dow Jones Industrial Average gained 396.66 points (2.47 percent) to close at 16,466.30. The broad-based S&P 500 advanced 46.88 (2.48 percent) to 1,940.24, while the tech-rich NASDAQ Composite Index rose 107.28 (2.38 percent) to close at 4,613.95.
The Bank of Japan adopted a below-zero-interest-rate policy, essentially charging lenders to park their cash with it. The move helped spur stocks higher in Europe and Asia.
Stocks picked up further momentum following government data showing the US economy grew an anemic 0.7 percent in the fourth quarter.
Analysts said the weak growth reduced the chances the US Federal Reserve would move quickly to increase interest rates again.
“This basically sets the tone that central banks are going to have to boost the economy,” First Standard Financial chief market economist Peter Cardillo said.
Stocks were also bolstered by crude oil prices, which rose for the fourth day in a row. The gain lifted petroleum-linked stocks, including Marathon Oil Corp and Halliburton Co, which jumped 6.1 percent and 4.4 percent respectively.
Chevron Corp rose a more modest 0.6 percent after reporting a surprise loss for the fourth quarter due to the slump in crude oil prices. Chevron lost US$588 million compared with net income of US$3.5 billion the previous year.
Amazon.com sank 7.6 percent after it reported fourth-quarter profits of US$482 million, up from US$214 million the previous year behind a 22 percent rise in revenue.
Some analysts expressed worry about an outlook that included a projection for first-quarter operating income of US$100 to US$700 million, but some other large technology shares rose.
Apple Inc and Intel Corp both surged 3.5 percent, while Cisco Systems advanced 3 percent.
Microsoft Corp jumped 5.8 percent after reporting fourth-quarter net income of US$5.8 billion in better-than-expected results that showed growth in its cloud-computing business.
Banking shares enjoyed a good session, with Citigroup Inc gaining 5.4 percent, JPMorgan Chase & Co 3.9 percent and Bank of America Corp 4.5 percent.
Visa Inc powered 7.4 percent higher on better-than-expected earnings, while Mastercard Inc gained 6.7 percent after also beating analysts’ estimates.
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