U.S. stocks ended higher on Friday, marking the conclusion of their most successful week of 2024 as the market rebounded from a sharp decline earlier in the month. The S&P 500 rose by 0.2% to 5,554.25, the Nasdaq Composite increased by 0.21% to 17,631.72, and the Dow Jones Industrial Average gained 96 points, or 0.24%, closing at 40,659.76. This performance capped off a week where the S&P 500 advanced nearly 3.9%, its best weekly gain since November 2023. The Nasdaq saw an impressive 5.2% increase, while the Dow climbed 2.9% over the same period.
The week’s gains were driven by a series of positive economic reports that alleviated concerns about a potential recession. Retail sales data released on Thursday exceeded economists’ expectations, and weekly jobless claims declined, suggesting that the fears which had led to a global market sell-off earlier this month were overblown. Additionally, inflation data released earlier in the week supported hopes for a soft landing scenario, further boosting market confidence.
UBS Global Wealth Management’s Mark Haefele commented on the data, noting, “Data released over the past week has struck the right balance, being not too hot, nor too cold. This should help allay both concerns of a looming recession or that sticky inflation will hamper the Federal Reserve if swift rate cuts are needed to defend growth.”
Tech stocks were particularly strong performers this week. Nvidia saw a substantial gain of over 18%, while Apple and Microsoft advanced approximately 4% and 3%, respectively. This surge in technology stocks contributed significantly to the market’s overall recovery.
The turnaround comes after a rough start to August, when the Dow Jones dropped by 1,000 points and the S&P 500 experienced its worst single-day performance since 2022 on August 5. Investor anxiety about the Federal Reserve’s timing on interest rate cuts and fears of a recession, compounded by a hedge fund currency trade unwind, had exacerbated market volatility.
However, the market has shown resilience since then. The S&P 500 has posted gains for seven consecutive days, and the Nasdaq achieved its best weekly performance since November 2023. On Friday, the University of Michigan’s latest survey revealed that consumer sentiment had risen more than expected, further supporting the market’s positive momentum.
As investors adjust their outlook based on recent economic data, the market’s recovery highlights the ongoing volatility and dynamic nature of the current economic environment. With the S&P 500 now just 2% shy of its mid-July record high, all eyes will be on upcoming economic indicators and Federal Reserve policy decisions to gauge the sustainability of this upward trend.
I am Aparna Sahu
Investment Specialist and Financial Writer
With 2 years of experience in the financial sector, Aparna brings a wealth of knowledge and insight to Investor Welcome. As an accomplished author and investment specialist, Aparna has a passion for demystifying complex financial concepts and empowering investors with actionable strategies. She has been featured in relevant publications, if any, and is dedicated to providing clear, evidence-based analysis that helps clients make informed investment decisions. Aparna Sahu holds a relevant degree or certification and is committed to staying ahead of market trends to deliver the most up-to-date advice.
