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Wall Street stocks rallied on Friday at the end of a volatile week of trading as hopes grew that the US government will avoid a costly shutdown.
The blue-chip S&P 500, which on Thursday fell into a technical correction, rebounded 1.9 per cent by midday in New York. All 11 sectors gained ground, with energy and financial services among the best performers. The tech-heavy Nasdaq Composite rose 2.3 per cent, erasing losses from the previous session.
The moves came after Chuck Schumer, the top Democrat in the US Senate, signalled his support for a Republican stop-gap funding bill, increasing the likelihood that Congress will avoid the risk of a government shutdown.
Friday’s market rally marks a bright spot for US equity investors who have suffered a bruising few weeks as Donald Trump’s erratic tariff announcements have weighed on animal spirits and fanned concerns about slowing growth in the world’s largest economy.
Data released by the University of Michigan on Friday morning showed US consumer sentiment tumbled in March, with long-term inflation expectations surging to their highest level in more than three decades and unemployment fears rising to levels last seen in 2008. Equity investors nonetheless opted to buy the market dip.
“A volatile week is ending with a small flurry of what traders interpret as good news,” said Thierry Wizman, global FX and rates strategist at Macquarie.
“The US government isn’t shutting down, China may seek to prop up its consumer sector further, Germany advanced toward fiscal reform and Canada and the US turned down the heat of tariff discussions.”
Wizman warned, however, that uncertainty triggered by Trump’s tariff threats remains “problematic”.
JPMorgan on Friday became the latest Wall Street bank to lower its 2025 US growth forecast, echoing recent downgrades from Goldman Sachs and Morgan Stanley.
“Consumers’ concerns about the impact of the Trump administration’s policies are growing,” said Harry Chambers of Capital Economics, adding that the University of Michigan survey would “fan recession flames further”.
European stocks ended the day higher, with the region-wide Stoxx Europe 600 up 1.1 per cent and Germany’s Dax rising 1.6 per cent. London’s FTSE 100 rose 1.1 per cent.
Asian stocks also closed higher. Hong Kong’s Hang Seng index added 2.1 per cent while China’s CSI 300 index of Shanghai- and Shenzhen-listed shares rose 2.4 per cent after Beijing promised fresh measures to “boost consumption”. Japan’s Topix gained 0.6 per cent.
In commodity markets, prices for Brent crude, the international oil benchmark, rose 1 per cent to $70.58 per barrel. Gold surged to a record high above $3,000 per troy ounce before falling back to $2,988.
