US stocks rose Friday and the S&P 500 notched its longest winning streak since 2004 as China signaled openness to trade talks and investors digested a better-than-expected jobs report.
The Dow closer higher by 564 points, or 1.39%. The broader S&P 500 rose 1.47% and the tech-heavy Nasdaq Composite gained 1.51%. The Dow and S&P 500 posted their ninth consecutive daily gain.
The S&P 500 posted its first nine-day winning streak since November 2004. While the index has notched many seven- and eight-day streaks in recent years, the nine-day consecutive winning streak had proved elusive for the past two decades — until today.
The S&P 500’s rally on Friday helped the index erase its losses since President Donald Trump announced his “reciprocal” tariffs on April 2.
The Dow posted its first nine-day winning streak since December 2023. The blue-chip index is still down about 2% from its closing price on April 2.
The stock market rally received a boost on Friday after Labor Department data showed the economy added 177,000 jobs in April, outpacing expectations of around 135,000 jobs.
“Markets breathed a sigh of relief this morning as the jobs data came in better than expected,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management, in an email. “While recession fears are still simmering on the back burner, the buy-the-dip dynamic can continue — at least until the tariff pause runs out.”
Stocks have steadily rallied in recent days as Trump has softened his tone on the US-China trade war and White House officials have teased potential trade deals with other countries, including India. Investors will be attuned to any potential developments or delays in trade progress during Trump’s 90-day pause on “reciprocal” tariffs except for China.
Stocks extended their gains on Friday after a Wall Street Journal report that China is considering how to address the United States’ concerns about its role in the international fentanyl trade.
A spokesperson for China’s Commerce Ministry on Friday said it is “currently evaluating” proposals by the United States to begin trade talks, which was a subtle tone shift that could open the door for negotiations.
“US employment remains strong despite tariff uncertainty,” said David Russell, global head of market strategy at TradeStation, in emailed remarks. “These numbers show leaders have breathing room to avoid a recession if they’re able to resolve trade issues sooner rather than later.”
Policy uncertainty persists
While the strong jobs data on Friday signaled a relatively robust labor market and assuaged some jitters about the health of the economy, investors will be focused on trade negotiations and data releases in coming months to further gauge the impact of tariffs.
“The labor market remained on solid footing through mid April, although this timing likely precedes any forthcoming impacts from trade policy uncertainty,” said David Doyle, head of economics at Macquarie, in a Friday note. “Looking ahead, the trajectory of the labor market remains interlinked with trade policy developments.”
Wall Street has been nervous about potential cracks in the economy after Commerce Department data this week showed the economy contracted last quarter for the first time in years. This was a jam-packed week for economic data releases, with other data from payrolls processor ADP showing private sector hiring slowed significantly in April.
CNN’s Fear and Greed index on Friday dipped back into “fear” after briefly rising into “neutral” on Thursday for the first time since February 19. The index had been staunchly in “fear” and “extreme fear” the past two months.
“We aren’t out of the woods yet, because it’s unclear how much different the US trade approach will be in the second half of 2025 versus what we’ve seen year to date,” Zaccarelli said.
Matt Stucky, chief portfolio manager for equities at Northwestern Mutual Wealth Management, told CNN that navigating “policy uncertainty” is the most significant focus for investors in the coming weeks.
“Investors are less concerned than they were obviously a couple of weeks ago,” Stucky said. “But that doesn’t mean it can’t go back, and can’t kind of ping pong between those two outcomes of pessimism and optimism. And so we’ll just have to wait and see what happens from the administration in the coming weeks.”
Trump on Friday morning posted on social media calling for the Federal Reserve to cut interest rates, continuing a tirade against the independent central bank. “NO INFLATION, THE FED SHOULD LOWER ITS RATE!!!,” Trump wrote.
A strong jobs report is often a signal that the Fed can reconsider how soon it needs to cut rates. Traders on Friday dialed back their expectations of a Fed rate cut in June, according to the CME FedWatch tool. Traders now expect a 36.6% chance the Fed cuts in June, down from a 55% chance yesterday.
Meanwhile, inflation has been cooling, but still remains above the Fed’s target of 2%. “This report buys the Fed more time to focus on the inflation mandate,” said Gina Bolvin, president of Bolvin Wealth Management Group, in an email.
Barclays and Goldman Sachs on Friday pushed back their expectations for the first rate cut this year to July from June.
The yield on the 10-year Treasury on Friday rose above 4.3%. The US dollar index fell 0.3%.
In global markets, Europe’s benchmark Stoxx 600 index gained 1.67%. Germany’s DAX index rose 2.62%. Japan’s Nikkei 225 rose 1.04% and Hong Kong’s Hang Seng index rose 1.74%.
Big Tech beckons the AI bulls
Wall Street’s rally this week was also boosted by strong earnings results on Wednesday from Meta (META) and Microsoft (MSFT). Investors are feeling reassured about the resilience of Big Tech’s focus on artificial intelligence. Meta shares gained 4.2% on Thursday and were up 4.3% on Friday. Microsoft shares surged 7.6% on Thursday and were up 2.3% on Friday.
The rally in tech stocks helped the Nasdaq on Thursday recover its losses since April 2. The tech-heavy index extended those gains on Friday.
“There are plenty of things to worry about in the world, but Meta’s resilience is not one of them,” analysts at Barclays said in a Wednesday note.
Microsoft’s earnings for the first quarter were “robust,” and showed that there is still considerable interest in developing data centers for AI, according to Dan Ives, global head of technology research at Wedbush Securities.
Apple (AAPL) on Thursday posted less well-received earnings as the company said it could take a $900 million hit in the second quarter due to tariffs. Apple shares were down 3.74% on Friday.
Amazon (AMZN) posted “healthy” first quarter results, Ives said, but offered mixed guidance for this year. Amazon shares edged lower on Friday.
If the S&P 500 closes higher again on Monday, it will be the first 10-day winning streak since the 1990s, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.
CNN’s John Liu contributed reporting.
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