Wall Street finishes its best week since Trump’s election with a rally

NEW YORK —  U.S. stock indexes closed their best week in two months with a flourish Friday.

The Standard & Poor’s 500 climbed 1% to clinch its first winning week in the last three. The Dow Jones industrial average rose 0.8%, and the Nasdaq composite rallied 1.5%.

Schlumberger helped lead the market after the provider of services to oil fields delivered bigger profit and revenue for the end of 2024 than analysts expected. It jumped 6.1% after it raised its dividend by 3.6% and said it’s returning $2.3 billion to its investors by buying back its own stock.

The most forceful pushes upward came from Big Tech stocks. All the companies in what’s come to be known as the “Magnificent Seven ” rose: Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla. Because they’re so massive, their movements carry more weight on the S&P 500 and other indexes than other stocks.

The Magnificent Seven have been under pressure recently because of criticism their stock prices may have shot too high after leading the market for so many years. Such worries grew after Treasury yields jumped in the bond market. Higher yields hurt prices for all kinds of investments, particularly those seen as the most expensive.

But stocks broadly got a lift this week from an encouraging report on U.S. inflation, which raised hopes that the Federal Reserve may deliver more interest rate cuts this year. More such cuts, which began in September, would ease the brakes off the economy and boost prices for investments, though they can also give inflation more fuel.

Wall Street has been lurching down and up in recent weeks as economic reports pushed traders to revamp their expectations about what the Fed will do with rates. Lower worries about inflation have sent Treasury yields down and stocks up, while worsening worries about inflation have triggered the opposite reaction.

Treasury yields eased sharply in the last week, and the 10-year Treasury yield eased further Friday. It’s at 4.61%, down from 4.62% late Thursday and from 4.76% a week earlier.

Still, even with this week’s better-than-expected readout on inflation, some on Wall Street remain skeptical about the chances for more cuts. With the U.S. economy in solid overall shape, “you shouldn’t fix what’s not broken,” Bank of America economists Claudio Irigoyen and Antonio Gabriel said in a BofA Global Research report.

They also pointed to the uncertainties created by “Trumponomics 2.0.” Policies pushed by President-elect Donald Trump could help push up inflation, or at least expectations for it, including widespread tariffs and tax cuts for an economy that’s already growing.

Prices for all kinds of investments from stocks to cryptocurrencies have swung amid the uncertainty after an initial burst since election day. On one hand are hopes for stronger profits for companies and greater acceptance of crypto. On the other are worries about a potentially swelling U.S. government deficit and upward pressure on inflation.

Wall Street still sees banks as some of the biggest beneficiaries from a second Trump administration. Besides a potentially stronger economy, which would boost profits for lending, investors expect another Trump term to mean less regulation on banks.

Truist Financial rose 5.9% on Friday after joining the list of banks to report better profits for the end of 2024 than analysts expected. The company said its average deposits rose 1.5% during the quarter, and it followed bigger-than-expected profit reports from large rivals including Wells Fargo and Citigroup

Other smaller, regional banks reported mixed results Friday. Regions Financial fell 1.3%.

J.B. Hunt Transport Services dropped 7.4% for the biggest loss in the S&P 500 after falling short of analysts’ expectations for profit in the latest quarter. Higher equipment and insurance-related costs helped drag on its results.

All told, the S&P 500 rose 59.32 points to 5,996.66. The Dow gained 334.70 points to 43,487.83, and the Nasdaq jumped 291.91 points to 19,630.20.

In stock markets abroad, indexes rallied in Europe after finishing mixed in Asia.

Chinese indexes rose modestly after authorities said the world’s second-largest economy grew at a 5% annual pace last year, hitting the government’s target but slowing from the year before. Stocks rose 0.3% in Hong Kong and 0.2% in Shanghai.

Economists are forecasting a further slowing of growth this year and beyond in China, and Trump’s threats to raise U.S. tariffs on Chinese goods have added to Beijing’s challenges as it faces a raft of moves by Washington to limit access to advanced technology, such as computer chips used in artificial intelligence.

In Tokyo, the Nikkei 225 fell 0.3% as Nintendo sank 4.3% after the unveiling of its newest console. The company promised more details about the Switch 2 in April and said it will be released this year.

Choe writes for the Associated Press.