The major averages closed higher on Friday hitting new records as they overcame concerns about economic growth from earlier in the week. The Dow closed above 35,000 for the first time ever, bringing its gain for 2021 to more than 14%. The blue chip average rose 238 points, or 0.68%, to 35,061 gaining for a fourth straight day. It made the 1,000-point trek rather quickly, having closed above 34,000 for the first time ever back in mid-April. The S&P 500 gained 44 points or 1% to 4,411 while the Nasdaq Composite climbed 1.04% to 14,836.99, both new closing highs for the benchmarks.
The 10-year Treasury yield bounced on Friday to 1.281%, easing concerns about the economy that the bond market triggered on Monday. The 10-year yield fell to a 5-month low of 1.13% earlier this week.
Strong earnings from tech stocks made investors optimistic ahead of reports next week from the biggest names in the sector. Twitter and Snap each jumped Thursday following better-than-expected second-quarter earnings reports. Twitter traded 3% higher, while Snap shot up 24%.
Facebook gained more than 5% on the results from its social media competitors. Alphabet added 3%. Both report next week along with Apple, Microsoft and Amazon.
All three U.S. stock averages closed the week in the green, rebounding from last week's losses and Monday's sharp sell-off. The Dow dropped more than 700 points to start the week as yields fell, unnerving equity investors about the economy.
The S&P 500 rose 2% for the week and the Nasdaq Composite added 2.8%. The Dow ended the week up 1%.
Strength in tech shares also comes with the continued spread of the highly contagious delta variant of Covid.
The stock market overall has been bolstered by a strong earnings reporting season, with nearly a quarter of the S&P 500 having already reported. Of those companies, 88% have reported a positive surprise, according to FactSet. That would mark the highest percentage of reported surprises within the S&P since 2008 if that figure holds throughout the earnings season.
Profit growth for the second quarter is expected to come in at 76%, according to Refinitiv, which would be the best growth since 2009. Profit margins have also held up in the face of rising inflation, with companies reporting average profit margins of 12.8% so far for the second quarter, above the historic range, according to S&P Global.
American Express reported better than expected quarterly results Friday morning, giving its shares a 1.3% boost.
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