Dow surges more than 600 points
Amid inflation, economist warns avoiding recession won't be 'easy path'ReplayMore Videos ... (16 Videos)Amid inflation, economist warns avoiding recession won't be 'easy path'See 'Law & Order' star's nude Peloton commercialSee which airports lead the nation in flight cancellations'I'm losing my mind': Chinese depositor loses life savings in bankPeople are revealing their salaries to this TikTok star. Would you?Business professor says that Elon Musk is on the hook for $45 billion'Worse than we anticipated:' CNN reporter breaks down inflation dataAnderson Cooper and William Shatner flip out over new NASA imagesRecession is likely coming. How bad will it be?Child care costs are rising. See how parents are copingThis is how data collected from fertility apps could be used to prosecute abortion Young shoppers love buy now, pay later. Here's why that might be a problemSee a simulation of AI technology being used to prevent a mass shootingElon Musk says Tesla factories are 'losing an insane amount of money'Warren to Powell: Don't drive this economy off a cliffAnalyst: Gas tax holiday 'won't change people's behavior'New York (CNN Business)US stocks surged Friday as an end-of-week rally gained momentum and sent the Dow up over 600 points.
A new batch of bank earnings and economic data Friday morning increased investors' optimism about the state of the economy and relieved them of worries that the Federal Reserve could raise rates by a full percentage point at its meeting later this month. The Dow (INDU) gained 622 points, or 22% in early afternoon trading. The S&P 500 (DVS) was up by 1.8% and the Nasdaq (NDX) rose by 1.6%. New earnings reports from Wells Fargo and Citigroup before the bell were well-received by markets, especially after JPMorgan (JPM) and Morgan Stanley (MS) missed estimates on Thursday. Jamie Dimon battens down the hatches for a recessionCitigroup (C) beat estimates and reported that it benefited from rising interest rates. Shares jumped by 10%. Wells Fargo (WFC) reported quarterly profit declines of 48% but its stock still gained more than 6%. Read MoreA red-hot inflation reading earlier this week sent markets reeling: The consumer price index, reported Wednesday, rose 9.1% year-over-year, the highest rate since 1981. But strong retail sales for June and preliminary consumer sentiment data released Friday helped buoy markets and ease tensions.Consumer spending makes up about two-thirds of the US economy. Given Friday's good reports, the US economy may have grown in the second quarter, avoiding two straight quarters of a shrinking economy -- a scenario some economists call a technical recession -- noted Jeffrey Roach, chief economist at LPL Financial.Why markets are in such a foul mood right nowThe new numbers and bank earnings helped soothe fears of a full percentage point hike by the Fed. Only 31% of investors are pricing in a 100 basis point hike as of Friday, compared with over 80% earlier in the week, according to the CME Fedwatch Tool. Tech stocks, which are particularly vulnerable to interest rate hikes, also jumped on Friday. Meta Platforms (FB) and Amazon (AMZN) were up over 3.5% and Netflix (NFLX) gained over 5%. Click Here To Get Funded!