The S&P 500 ended the week at record high on Friday, lifted by Nike Inc and several banks, while weaker-than-expected inflation data eased worries about a sudden tapering in stimulus by the US Federal Reserve.
Nike surged 15.5 percent to an all-time high after the sneaker maker forecast fiscal full-year sales ahead of Wall Street estimates, helping the Dow lead among the three main indices.
Bank of America Corp increased 1.9 percent and Wells Fargo & Co rallied 2.7 percent after the Fed announced that big banks have cleared stress tests and would no longer face restrictions related to the COVID-19 pandemic on buying back stock and paying dividends.
The S&P 500 Financials Sector Index rose 1.25 percent and was the top performers among 11 sector indices.
“Today is a bit of profit-taking in tech and a reallocation into the banks after the results of the stress tests,” said Dennis Dick, a proprietary trader at Bright Trading LLC, adding that he expects banks to soon announce increased dividends.
A bipartisan US Senate deal on infrastructure spending embraced by US President Joe Biden on Thursday continued to lift stocks, with the materials and industrials indices increasing and helping the S&P 500 outperform the NASDAQ.
Photo: Reuters
“The positive news from the infrastructure package favors the S&P 500 more than then NASDAQ. The NASDAQ does not pour cement into roads and put steel in bridges. That’s the S&P 500,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.
The latest personal consumption expenditures (PCE) data showed a measure of underlying inflation rose less than expected last month. Core PCE rose 3.4 percent year-on-year as expected, above the Fed’s 2 percent flexible target.
Billionaire Richard Branson’s spaceship company Virgin Galactic soared almost 40 percent and was Wall Street’s second most traded company after receiving approval from the US aviation safety regulator to fly people to space.
With the FTSE Russell reconstituting its indices following a wild trading year marked by the pandemic and “meme” stocks, volume on US exchanges surged to 15.1 billion shares, versus the 11.2 billion average over the past 20 trading days.
The Dow Jones Industrial Average rose 0.69 percent to end at 34,433.84 points, while the S&P 500 gained 0.33 percent to 4,280.7. The NASDAQ Composite dropped 0.06 percent, to 14,360.39.
For the week, the S&P 500 gained 2.74 percent, the Dow added 3.44 percent and the NASDAQ gained 2.35 percent. It was the S&P 500’s strongest week since early February and the NASDAQ’s strongest since April.
Advancing issues outnumbered declining ones on the NYSE by a 1.29-to-1 ratio; on the NASDAQ, a 1.22-to-1 ratio favored advancers.
The S&P 500 posted 32 new 52-week highs and no new lows; the NASDAQ Composite recorded 149 new highs and 14 new lows.
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