Financial stocks surged on Friday, lifting the S&P 500 and Dow Jones Industrial Average to new record highs.
Strong earnings from major U.S. banks outweighed mixed economic data released earlier.
The S&P 500, tracked by the SPDR S&P 500 ETF Trust SPY, jumped 0.7% to over 5,800 points, with year-to-date returns nearing 23%.
The Dow, monitored by the SPDR Dow Jones Industrial ETF DIA, rose 0.8% to 42,780 points, setting new records.
Chart: S&P 500, Dow Hit Record Highs on Strong Bank Earnings
Financial Stocks Lead Market Gains
The financial sector was the main driver of Friday’s gains. The Financial Select Sector SPDR Fund XLF rose 1.9%, its best day since November 2023, reaching a new high.
U.S. banks reported strong third-quarter earnings, boosting confidence in the sector.
JPMorgan Chase & Co. JPM posted Q3 earnings per share (EPS) of $4.37, beating the $4.00 consensus, with shares up over 4% mid-morning. Analyst Richard Ramsden noted a strong performance across all areas for JPM.
Wells Fargo & Co. WFC saw shares jump 6.2% after an EPS of $1.42, beating estimates.
Bank of New York Mellon Corp. BK also exceeded expectations, with shares rising 1.8%. BlackRock Inc. BLK gained 3.4% after strong earnings, reaching a new high.
Other banks like Bank of America BAC, Citigroup C, Goldman Sachs GS, and Morgan Stanley MS saw increases between 2% and 4.8%. Morgan Stanley also hit a record high.
The strength of large banks also boosted regional stocks, with the SPDR S&P Regional Banking ETF KRE up 3.5%, lifting the Russell 2000 index by 1.3%.
Mixed Economic Data but Strong Earnings Prevail
Friday’s economy reports showed a higher-than-expected Producer Price Index (PPI) and weaker Michigan Consumer Sentiment.
September’s PPI was 1.8% year-over-year, above the expected 1.6%. Core prices rose from 2.6% to 2.8%. The University of Michigan’s consumer sentiment index dropped to 68.9, below forecasts.
Inflation expectations rose slightly; consumers voiced concerns over high prices, but business conditions improved.
Top 5 S&P 500 Performers on Friday
| Stock | Sector | Price | 1-day Return (%) |
|---|---|---|---|
| Uber Technologies, Inc. UBER | Industrials | $84.21 | 8.07% |
| Fastenal Company FAST | Industrials | $75.13 | 7.34% |
| Wells Fargo & Company | Financials | $60.99 | 5.61% |
| WW. Grainger, Inc. GWW | Industrials | $1,079.38 | 5.29% |
| Bank of America Corporation | Financials | $41.97 | 4.99% |
Top 5 Dow Performers on Friday
| Stock | Sector | Price | 1-day Return (%) |
|---|---|---|---|
| JPMorgan Chase & Co. | Financials | $221.99 | 4.30% |
| The Boeing Company BA | Industrials | $150.55 | 2.68% |
| The Goldman Sachs Group, Inc. | Financials | $513.51 | 1.94% |
| Intel Corporation INTC | Information Technology | $23.63 | 1.78% |
| American Express Company AXP | Financials | $274.73 | 1.58% |
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