Wall Street rallied Friday after fresh inflation data showed price pressures easing faster than expected, reinforcing hopes that the Federal Reserve could soon begin cutting interest rates. The upbeat economic report, combined with strong corporate earnings, lifted all three major indexes and capped a positive week for U.S. equities.
U.S. stocks ended sharply higher, with investors welcoming signs that inflation continues to cool while the economy remains resilient. The S&P 500 rose 0.8%, the Dow Jones Industrial Average gained 1.0%, and the tech-heavy Nasdaq 100 advanced 1.1%, marking a broad-based rally across major sectors.
The SPDR S&P 500 ETF Trust (SPY) closed at $677.25, up 0.8%, after trading between $672.62 and $678.46 throughout the session. The Dow-tracking SPDR DIA ETF ended at $472.21, rising 1.0%, while the Invesco QQQ Trust — a proxy for the Nasdaq's largest technology names — finished at $617.10, up 1.05%, after touching an intraday low near $612.57.
Trading volumes strengthened heading into the weekend as investors increased exposure to equities following favorable economic data. The September Consumer Price Index (CPI) rose 0.3% month-on-month, below the 0.4% forecast, and 3.0% year-over-year, compared with expectations of 3.1%. The softer reading boosted confidence that the Federal Reserve could move toward its first rate cut in over a year, possibly as early as December.
Market breadth was positive, with nine of eleven S&P 500 sectors finishing higher. Technology, industrials, and financials led the advance, while utilities and real estate lagged modestly. Analysts noted that Friday's session extended the market's recent uptrend, supported by easing inflation pressures and solid third-quarter earnings.
S&P 500 Performance (SPY)
The S&P 500 climbed, with the SPDR S&P 500 ETF Trust (SPY) closing at $677.25, up 0.80%, after trading between $672.62 and $678.46. The Vanguard S&P 500 ETF (VOO) finished at $622.38, also up 0.8% on the day.
All major large-cap sectors advanced, led by financials and consumer discretionary stocks, while energy posted moderate gains. The index remains up more than 16% year-to-date, reflecting continued optimism around corporate resilience and expectations of a more accommodative policy stance from the Federal Reserve.
NASDAQ Composite Index Performance (QQQ)
The Invesco QQQ Trust (QQQ) closed at $617.10, rising 1.05% for the session, as technology and growth stocks outperformed. The ETF traded between an intraday high of $618.40 and a low of $612.57.
Semiconductor and software shares led the gains, with the broader tech sector benefiting from easing Treasury yields and strong quarterly results from key industry leaders. The Nasdaq remains on track for one of its strongest monthly performances since early 2023.
Dow Jones Industrial Average Index Performance (DIA)
The Dow Jones Industrial Average gained 1.04%, with the SPDR Dow Jones Industrial Average ETF (DIA) closing at $472.21 after fluctuating between $467.22 and $473.24 during the session.
Industrials, financials, and healthcare stocks were the primary drivers, helping the index end near a five-month high. Blue-chip strength reflected broad market confidence in the economic outlook, with investors rotating into cyclical sectors expected to benefit from steady growth and moderating inflation.
The day's advance capped a strong week for equities overall, positioning Wall Street for continued momentum into the final stretch of October.
