US stock indices are rallying, led by megacap growth and health stocks at the end of a volatile week, ravaged by concerns about the impact of rising inflation on earnings and the impact of interest rate hikes on economic growth.
Nine of the 11 major S&P sectors made progress in morning trading. Energy was the best performer, up 2.2 percent, followed by the healthcare and technology sectors.
Microsoft Corp, Amazon.com and Apple Inc , rose between 1.5 and 1.8 percent, giving the biggest boost to the S&P 500 and Nasdaq.
“Some traders are taking advantage of the price weakness, at least in the short term, to make some money. The real question is whether this will last at the end of the day,” said Sam Stovall, chief investment strategist at CFRA Research.
“It’s definitely going to be a battle for traders today. The market is trying to at least orchestrate a short-term relief rally, which is normal within bear market trends.”
Disappointing forecasts from major retailers Walmart Inc and Target Inc this week disrupted market sentiment, adding to evidence that rising prices are beginning to hurt the purchasing power of US consumers.
The S&P 500 and Nasdaq are poised for their seventh consecutive week of losses, their longest losing streak since the end of the dotcom bubble. The Dow is on track for its eighth consecutive weekly decline, the longest since 1932, during the Great Depression.
The indices have fallen between 13.3 percent and 26.1 percent so far this year as investors adjust to supply chain austerity, lockdowns in China, geopolitical uncertainty due to the conflict in Ukraine and interest rate hikes by the US Federal Reserve.
Traders are anticipating 50 basis point rate hikes by the US central bank in June and July.
The benchmark index is down about 18.1 percent from its record January 3. A close of 20 percent or more below that level confirms that the S&P 500 has been in a bear market since it peaked.
In early trading Friday, the Dow Jones Industrial Average rose 189.32 points, or 0.61 percent, to 31,442.45, the S&P 500 rose 34.31 points, or 0.88 percent, to 3,935.10, and the Nasdaq Composite rose. by 117.90 points, or 1.04 percent, at 11,506.40.
Asian and European stocks recovered Friday after China lowered a key credit benchmark to support its economy.
Ross Stores fell 23.3 percent after the discount clothing store lowered its 2022 revenue and profit forecasts, while Vans brand owner VF Corp gained 4.5 percent on a strong 2023 revenue outlook.
Deere & Co fell 10 percent after the heavy equipment maker posted poor quarterly sales.
Match Group Inc climbed 4.6 percent to the top of the S&P 500 index as Alphabet Inc’s Google would allow the dating app maker to offer users a choice of payment systems.
The number of emerging issues outpaced the pastures by a 2.28-to-1 ratio on the NYSE and a 2.03-to-1 ratio on the Nasdaq.
The S&P index recorded one new high in 52 weeks and 36 new lows, while the Nasdaq recorded 11 new highs and 143 new lows.