Wall Street ends whipsaw week higher

Wall Street posted solid gains on Friday as big banks kicked off first-quarter earnings season and investors closed the book on a turbulent week of wild swings driven by the chaos of US President Donald Trump's multi-front trade war.

All three major US indexes ended the session sharply higher after assurances from Boston Federal Reserve President Susan Collins that the Fed is prepared to keep financial markets functioning should the need arise.

All three indexes posted gains from last Friday's close. Stocks were whipsawed throughout the week by a tariff reprieve on European goods and a tit-for-tat escalation in the trade war between the US and China. One sign of the volatility: the difference between the weekly high and weekly low for the S&P500 was the widest since late March 2020 when much of the world was locked down during the pandemic.

The S&P 500 and the Dow notched their largest weekly percentage gains since November 2023, while the Nasdaq registered its biggest weekly percentage advance since November 2022.

"Investors are in the midst of this tug of war looking for some positive signs that the uncertainty that's really been plaguing the market will subside," said Greg Bassuk, Chief Executive Officer at AXS Investments in New York.

"Uncertainty and volatility is the new investor narrative. The table is set for more volatility ahead and this week's roller coaster ride could be just foreshadowing for what's ahead."

Beijing retaliated to Trump's recent hike of tariffs to an effective rate of 145 per cent. The trade war has caused wild intraday market swings and driven consumers' near-term inflation expectations to their hottest level since 1981.

First-quarter reporting period got off to a solid start. JPMorgan Chase, Morgan Stanley and Wells Fargo all reported better-than-expected profits, but warnings of a potential economic slowdown due to trade disputes dampened enthusiasm for the sector.

Analysts currently expect aggregate S&P 500 earnings growth of 8.0 per cent for the first three months of the year, less optimistic than the 12.2 per cent growth predicted at the beginning of the quarter, according to LSEG data.

Economic data offered further evidence that inflation continues to cool, with the Labor Department's Producer Prices index unexpectedly falling by 0.4 per cent last month.

In a separate report, however, consumer sentiment soured further. One-year inflation expectations shot up to 6.7 per cent, the highest level since 1981.

In addition to Collins' reassurances, New York Federal Reserve President John Williams said the US economy is not entering a period of high inflation and low growth, and the US Federal Reserve will act to keep so-called "stagflation" at bay.

All 11 major sectors in the S&P 500 were last in positive territory, with materials and technology enjoying the largest percentage gains.

The Dow Jones Industrial Average rose 619.05 points, or 1.56 per cent, to 40,212.71, the S&P 500 gained 95.31 points, or 1.81 per cent, to 5,363.36 and the Nasdaq Composite gained 337.15 points, or 2.06 per cent, to 16,724.46.

Advancing issues outnumbered decliners by a 2.47-to-1 ratio on the NYSE. There were 60 new highs and 341 new lows on the NYSE.

On the Nasdaq, 2,948 stocks rose and 1,467 fell as advancing issues outnumbered decliners by a 2.01-to-1 ratio.

The S&P 500 posted one new 52-week high and 5 new lows while the Nasdaq Composite recorded 21 new highs and 147 new lows.

Volume on US exchanges was 19.19 billion shares, compared with the 18.74 billion average for the full session over the last 20 trading days.