Volatile markets climb wall of worry

Wall Street ended sharply higher after a volatile session Friday, with the Nasdaq rebounding at the end of a week that saw it extend losses to about 10 percent from its previous record high.

All three main indexes bounced back from losses earlier in the day, with investors spooked by rising interest rates that offset optimism about an economic rebound.

Microsoft rallied 2.15 percent, boosting the S&P 500 more than any other stock, with gains in Alphabet, Apple and Oracle also lifting the index.

The benchmark 10-year US Treasury yields hit a new one-year high of 1.626 percent after non-farm payrolls increased by 379,000 jobs last month, blowing past a rise of 182,000 forecast by economists polled by Reuters.

The Nasdaq logged its third straight weekly decline after a recent spike in Treasury yields dented demand for high-flying technology stocks. The tech-heavy Nasdaq is around 8 percent below its Feb. 12 closing high.

Rising interest rates disproportionately hurt high-growth tech companies because investors value them based on earnings expected years into the future and high interest rates hurt the value of future earnings more than the value of earnings made in the short term.

Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Okla., said his firm in recent days has bought shares in a handful of growth companies whose prices have been pummeled in the recent sell-off.

“Next week, I would expect volatility to continue, with pockets of opportunity, with certain things that sold off potentially rebounding,” Dollarhide said.