Dow jumps 150 points, heads for record close as Wall Street caps off big week - 3 minutes read
Stocks rose on Friday as Wall Street looked to end a strong week on a high note.
The Dow Jones Industrial Average traded 150 points higher and was on its way to post a record closing high. The S&P 500 advanced 0.3% and hit a fresh all-time high. The Nasdaq Composite climbed 0.3%.
The major stock indexes jumped to their session highs after Dow Jones reported that Vice President Mike Pence would postpone a China policy address amid "positive signs" on trade. Equities had traded slightly lower prior to the news.
Treasury yields climbed on the news, lifting bank shares. The benchmark 10-year Treasury yield traded at 2.063%. Citigroup and J.P. Morgan Chase shares rose 0.8% and 0.9%, respectively. Bank of America traded 0.6% higher.
Friday's stock gains built on a strong weekly performance for the major indexes that was partially driven by investors cheering the prospects of the Federal Reserve cutting interest rates as soon as July. The Dow and S&P 500 were both up more than 2% for the week, while the Nasdaq rose 3.4%.
The Fed said earlier this week it is ready to keep the current economic expansion going as trade tensions and weaker data dampen the U.S. economic outlook. The central bank also dropped the word "patient" from its monetary policy statement, which was released Wednesday.
This led investors to price in a 100% probability of a rate cut next month and bolstered equity prices this week.
Traders work the floor of the NYSE.
Brendan McDermid | Reuters
"The biggest takeaway from this week is the power central banks still have to move markets, regardless of the reason," said chief market strategist at Prudential Financial. "You go back to Jan. 4 with the Fed 'pivot' and you saw the market go up from the 2018 lows in dramatic fashion. Fast forward, the Fed verbally intervened in the market before this week's meeting, suggesting they would be prepared to lower rates if the economy didn't improve."
Right now, "the market is applauding this message" from the Fed, Krosby said.
The central bank's announcement sent ripples across financial markets. The benchmark 10-year yield broke below 2% for the first time since November 2016. Gold prices hit their highest level since 2013.
Crude prices also surged this week as tensions between the U.S. and Iran increased after a drone was shot down over Iranian airspace. President Donald Trump reacted to the incident by saying Iran made a "very big mistake." U.S. oil rose 0.6% to $57.44 per barrel and is up more than 9% for the week.
- CNBC's Spriha Srivastava and Sam Meredith contributed to this report.