The S&P 500 posted its best week since June after a report on Thursday showed that inflation was slowing, raising hopes that the Federal Reserve will soon ease its tightening policy.
The broader market index rose 0.9 percent to close at 3,992.93 points. That brought its gain for the week to 5.9%, its best week since ending June 24 this year. The Nasdaq Composite rose about 1.9 percent to close at 11,323.33 as investors snapped up technology stocks on hopes of lower interest rates. The Dow Jones Industrial Average rose 0.1% to close at 33,747.86.
Tech stocks shrugged off losses in cryptocurrencies on Friday. The virtual currency, which has fallen sharply this week, came under pressure again on Friday after FTX filed for bankruptcy protection and CEO Sam Bankman-Fried resigned. Both bitcoin and ether fell.
Still, technology and related crypto stocks rebounded after opening lower on Friday. Technology stocks in the S&P 500 surged 10% through Friday, their best week since April 2020. Amazon rose more than 4 percent on Friday, while Google parent Alphabet gained 2.6 percent.
The Dow rose more than 1,200 points on Thursday after consumer prices rose less than expected in October, giving investors hope that inflation may be cooling. The S&P rose 5.5% and the Nasdaq Composite rose about 7.4%. All three indexes had their best day so far in 2020.
U.S. Treasury yields plummeted on Thursday on weaker-than-expected inflation data. Bond markets were closed Friday for Veterans Day.
“From an equity perspective, this should remove a major headwind as long as the threat of higher interest rates is no longer present,” Emmanuel Cau, head of European equity strategy at Barclays, wrote in a Friday note.
All indices posted winning weeks. For the week, the Dow gained 4.1%, while the Nasdaq Composite gained 8.1%. This week marks the resumption of a bear market rally that began in mid-October.