US stocks turned higher Friday as Wall Street looked to bounce back from the Dow’s biggest wipeout in over a year.
The S&P 500 (^GSPC) rose about 0.3%, while the tech-heavy Nasdaq Composite (^IXIC) gained around the same amount. The blue-chip Dow Jones Industrial Average (^DJI) put on around 0.1%, or roughly 50 points.
Renewed interest rate concerns fueled Thursday’s rout, led by the Dow’s more than 600-point decline. Meanwhile, US Treasury yields pushed back up, with the benchmark 10-year yield (^TNX) hovering closer to 4.5%.
A roaring mood turned sour after stronger-than-expected US business data prompted a rethink on the Federal Reserve’s path on interest rates.
Traders are about evenly split on whether the central bank will slash rates at its September meeting, according to the CME FedWatch tool. That marks a significant shift from a few days ago, when only around one-third expected the Fed to hold steady through the fall’s first meeting. Goldman Sachs on Friday said it no longer expects the Fed to make its first cut in July, instead suggesting September was most likely.
But Wall Street could enter the holiday weekend in better spirits. Nvidia (NVDA), whose latest blowout quarter spurred an early rally Thursday, was up shy of 1% Friday to hover around $1,040 per share. Its coming stock split may fuel even more retail interest in its stock.
Highlighting the macroeconomic front Friday is a revised look at the University of Michigan’s consumer sentiment index for May. An earlier reading showed the index plunged this month, as inflation and interest rate concerns bit into Americans’ views of the economy.
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