Friday uptick rescues markets from down week

U.S. stocks burst to their best day in three weeks on Friday, helping Wall Street return to record heights and avoid what could have been a second straight weekly loss.

The S&P 500 added 65.02 points, or 1.7%, to 3,974.54, with a quarter of that rise coming in the last five minutes of trading alone. Some of the biggest gains came from companies whose profits would jump the most if COVID-19 vaccinations and massive U.S. government spending programs juice the economy as much as economists expect. The index locked in a 1.7% gain for the week after losing 0.8% last week.

The Dow Jones Industrial Average rose 453.40 points, or 1.4%, to 33,072.88, and both it and the S&P 500 set all-time highs. The Nasdaq composite climbed 161.05, or 1.2%, to 13,138.72, though it remains 6.8% below its record set last month.

Stock prices have been churning in recent weeks, and momentum has often shifted sharply, sometimes by the hour. Rising expectations for a supercharged economic recovery are supporting many

stocks on one hand, while worries about the possibility of higher inflation and rising interest rates are undercutting the market on the other.

This past week, everything from President Joe Biden doubling his goal for COVID-19 vaccinations to a skyscraper-sized ship blocking one of the world’s most important canals sent markets swinging.

Much of the stock market’s recent turbulence has been an after-effect of movements in the bond market, where Treasury yields have been largely climbing since last autumn. Higher yields can make investors less willing to pay high prices for stocks, with companies seen as the most expensive taking the most pain. Companies that ask their investors to wait many years for the payoff of big profit growth have also been hit hard.

The yield on the 10-year Treasury rose to 1.67% from 1.61% late Thursday. But that’s still below where it was last week, when it rose above 1.70% and touched its highest level since before the pandemic began.

Such high-growth stocks were turning in a mixed performance on Friday. Apple rose 0.5%, but only after swinging between gains and losses numerous times through the day. Microsoft rallied 1.8%, and Facebook climbed 1.5%, but Tesla dropped 3.4%.