U.S. markets break three-week slump with strong Friday close

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U.S. markets had a strong finish to the week Friday, with all three major indexes posting weekly gains for the first time in a month. File Photo by John Angelillo/UPI | License Photo

Sept. 9 (UPI) — U.S. markets finished the week Friday ahead after a third day of gains broke a three-week slump.

The Dow Jones Industrial average gained 377.19 points, or about 1.19%, to close at 32,151.71. The S&P 500 rose 61.18 points, or 1.53%, closing at 4,067.36, while the Nasdaq Composite climbed 250.18 points, or 2.11%, closing at 12,112.31.

Friday’s strong finish pushed the Dow up 2.84% for the week, while the S&P 500 and Nasdaq rose 3.83% and 4.2% respectively, CNBC reported.

The markets have been volatile after substantial interest rate hikes at the Federal Reserve’s last three policy meetings have brought the federal funds rate to a range between 2.25% and 2.5%.

“The case for the ongoing bear market is that the Fed will continue to tighten monetary policy, withdraw liquidity from the market and cause a tailspin for equities,” David Donabedian, chief investment officer for CIBC Private Wealth US, told CNBC.

“But this week’s market recovery has shown there is continued resilience in the economy bolstered by favorable economic reports,” he said.

Donabedian said he expects a series of setbacks and recoveries before the next bull market.

Resilience among U.S. companies has appeared in strong earnings results.

Kroger reported stronger-than expected second quarter earnings Friday, with with sales rising 5.4% to $34.64 billion. Shares of Kroger rose 7.4%, closing at $51.94.

Other companies that finished the week strong include cloud security company Zscaler Inc., which rose 21.88% Friday, and electronic signature company DocuSign Inc., up 10.51%.

Federal Reserve Chairman Jerome Powell reiterated his intention to continuing fighting inflation with higher interest rates during an address inflation during an address to the Cato Institute on Thursday.

“For investors, the bottom line is that the central bank shock — particularly from the Fed — is not over,” Bank of America economists wrote. “This means more pressure on interest rates, more weakness in risk assets and further upside for the super-strong dollar.”

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