Wall Street’s main stock indices closed at record levels on Friday, fueled by fresh optimism over a potential calming of US-China trade tensions and by big gains in shares of healthcare companies.
The benchmark S&P 500 tallied its sixth straight week of gains, its longest such weekly streak in about two years, while the Dow Jones Industrial Average breached 28,000 for the first time.
White House economic adviser Larry Kudlow late on Thursday said that the US and China were getting close to a trade agreement, citing what he called very constructive talks with Beijing.
“Today is definitely about optimism surrounding the trade tensions,” said Jason Pride, chief investment officer of private wealth at Glenmede Trust in Philadelphia.
The stock market has climbed recently to record highs, driven by US Federal Reserve interest rate cuts, third-quarter earnings topping low expectations and signs that economic growth might be bottoming, while uncertainty over US-China trade relations remains a wild card.
“It’s definitely been a big source of volatility over a fairly long period of time for the markets and stocks in general,” Pride said. “To see some sort of resolution of it would probably be a lift to investors and to equity holders, because it takes away a big piece of uncertainty in many investors,’ and even corporate executives,’ minds.”
The Dow Jones Industrial Average on Friday rose 222.93 points, or 0.8 percent, to 28,004.89, the S&P 500 gained 23.83 points, or 0.77 percent, to 3,120.46 and the NASDAQ Composite added 61.81 points, or 0.73 percent, to 8,540.83.
Ten of 11 S&P 500 sectors ended positive. Healthcare led the way, gaining 2.2 percent for its biggest one-day percentage rise since January, with UnitedHealth Group shares surging 5.3 percent and Pfizer rising 2 percent.
For the week, the Dow rose 1.3 percent, the S&P added 1 percent and the NASDAQ Composite gained 0.9 percent.
Friday’s gains came as US President Donald Trump made an announcement on healthcare price transparency.
Regulatory and election risks have contributed to the healthcare sector’s underperformance this year, said Walter Todd, chief investment officer at Greenwood Capital in Greenwood, South Carolina, adding that perhaps Friday’s gains were “a catch-up trade.”
Shares of Applied Materials Inc soared 9 percent after the chip gear maker forecast first-quarter revenue and profit above Wall Street estimates.
The Philadelphia SE Semiconductor index gained 0.9 percent and hit a record high. Enthusiasm for the group was tempered by a 2.7 percent decline in Nvidia Corp shares following the chipmaker’s report.
Data on Friday showed US retail sales rebounded last month, but consumers cut back on purchases of big-ticket household items and clothing, which could temper expectations for a strong holiday shopping season.
Advancing issues outnumbered declining ones on the New York Stock Exchange by a 1.84-to-1 ratio; on the NASDAQ, a 1.50-to-1 ratio favored advancers.
The S&P 500 posted 52 new 52-week highs and one new low; the NASDAQ Composite recorded 121 new highs and 108 new lows.
About 6.5 billion shares changed hands in US exchanges on Friday, below the 6.9 billion-share daily average over the past 20 sessions.
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