The major averages rose sharply on Friday as Wall Street caps off a strong weekly performance, recovering from a Federal Reserve-induced slump. The Dow Jones Industrial Average gained 377 points, or 1.19% to 32,151. The S&P 500 jumped 61 points or 1.53% to 4,067 while the Nasdaq Composite climbed 250 points or 2.11% to 12,112.
Shares of DocuSign surged more than 10% after the electronic agreements company reported an earnings beat. The company also issued a third-quarter revenue forecast that was above expectations.
All three major averages snapped a three-week losing streak. The Dow added 2.66% on the week, while the S&P 500 gained 3.65%. The Nasdaq Composite is 4.14% higher.
Stocks have been volatile recently as expectations of a 0.75 percentage point rate hike this month grew on Wall Street, after the Federal Reserve Chair Jerome Powell said again that he is "strongly committed" to bringing down inflation.
"The case for the ongoing bear market is that the Fed will continue to tighten monetary policy, withdraw liquidity from the market and cause a tailspin for equities," said David Donabedian, chief investment officer of CIBC Private Wealth U.S. "But this week's market recovery has shown there is continued resilience in the economy bolstered by favorable economic reports."
Still, Donabedian added that he does not think stocks have reached the bottom of the bear market yet.
"Indeed, the journey to the next bull market will take time, and will be marked by a series of set-backs and recoveries," he said.
All three major averages closed higher Friday, notching gains in the holiday-shortened week and snapping a three-week slump. The Dow rose 2.8% on the week, while the S&P 500 and the Nasdaq gained 3.8% and 4.2%, respectively.
he Dow Jones Industrial Average gained 377.19 points, or about 1.19% to 32,151.71. The S&P 500 jumped 1.53% to 4.067.36 and the Nasdaq Composite climbed 2.11% to 12,112.31.
S&P 500 reclaims important technical zone, bigger test ahead
Market pros who follow charts see positive progress in the fact that the S&P 500 was able to reclaim its 50-day moving average in Friday's rally.
Strategists expect stocks could continue higher into the week ahead. As of 3:30 p.m., the market was on track to close out its first positive week in four with a big gain.
Stocks do face a key test in Tuesday's consumer price index, a data point that could help the Federal Reserve decide how much to raise interest rates later this month.
If the S&P can hold the 50-day, now 4,030, that would be viewed as a sign of positive momentum. The 50-day is literally the average of the last 50 closes.
Oppenheimer's Ari Wald said the next challenge for the S&P 500 is to break back above its 200-day moving average, now at 4,275.
All comments contained herein are for informational purposes only, and should not be considered as a solicitation to buy or sell any security. The firm does not guarantee the accuracy or completeness of the information or make any warranties regarding results from it's usage.