U.S. stocks rose on Friday as optimism over a strong U.S. economy and lower interest rates boosted sentiment, while reports of less severe trade tariffs on China also lifted investor confidence.
The Dow rose 0.5% and the S&P 500 gained 0.7% as of 10:50 ET (15:50 GMT), with the Nasdaq rising 0.4%. The three major indexes – the Dow, S&P 500, and Nasdaq – are set to end November with gains of 5% to 7%, having rallied to record highs following President-elect Donald Trump’s victory.
Investors are positioning for more expansionary policies under Trump, with economically sensitive sectors such as technology, industrials, and financials leading the market higher.
The week ahead will be dominated by comments from Federal Reserve officials, including Chair Jerome Powell on Wednesday, which will provide more cues on interest rates. Despite recent signs of sticky inflation and labor market strength, markets continue to expect a 25 basis point cut in December, bringing the Fed’s total rate cuts in 2024 to 100 basis points.
The Fed’s next meeting is scheduled for December 17 and 18. However, some concerns have emerged about the pace of rate cuts in 2025, with sticky inflation expected to push the fed’s terminal rate higher.