US stocks rallied to their best day in months on Friday as Wall Street’s roller coaster suddenly shot back upward. That still wasn’t enough to keep the US market from a fourth straight losing week, its longest such streak since August.
The S&P 500 jumped 2.1% a day after closing more than 10% below its record for its first “ correction ” since 2023. The last time the index shot up that much was the day after President Donald Trump’s election, when Wall Street was focusing on the upsides of Trump’s return to the White House.
The Dow Jones Industrial Average climbed 674 points, or 1.7%, and the Nasdaq composite jumped 2.6%.
A multi-day “relief rally could be coming” after so much negativity built among investors, said Yung-Yu Ma, chief investment officer at BMO Wealth Management. Swings in sentiment don’t go full-tilt in just one direction forever, and the US stock market has been tumbling quickly since setting a record less than a month ago.
One piece of uncertainty hanging over Wall Street may be clearing after the Senate made moves to prevent a possible partial shutdown of the US government.
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Past shutdowns have not been a huge deal for financial markets. But any reduction of uncertainty can be helpful when so much of it has been sending the US stock market on big, scary swings not just day to day but also hour to hour.
To be sure, the heaviest uncertainty remains with Trump’s escalating trade war. There, the question is how much pain Trump will let the economy endure through tariffs and other policies in order to reshape the country and world as he wants. The president has said he wants manufacturing jobs back in the United States, along with a smaller US government workforce and other fundamental changes.
While stock prices may be close to finishing their reset to account for tariffs set to hit in April, Ma said concerns about how big an impact cutbacks in federal spending will have on the economy are “likely to remain for some time.”
US households and businesses have already reported drops in confidence because of all the uncertainties created by Trump’s barrage of on -again,
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