Financial stocks rallied, lifting Wall Street’s spirits on Friday and pushing both the S&P 500 and Dow Jones to record highs.
Strong earnings from major U.S. banks boosted the market, as investors ignored mixed economic data released earlier.
The S&P 500, tracked by the SPDR S&P 500 ETF Trust (SPY), rose to over 5,800 points, up 0.7%, bringing its annual return close to 23%.
Similarly, the Dow Jones Industrial Average, tracked by the SPDR Dow Jones Industrial ETF (DIA), increased by 0.8% to 42,780 points, exceeding previous records set in late September.
Chart: S&P 500, Dow Reach Record Highs as US Banks Beat Q3 Earnings Estimates
Financial Stocks Lead Wall Street Surge
The financial sector was the main driver of Friday’s gains, with the Financial Select Sector SPDR Fund (XLF) jumping 1.9%, its best day since November 2023, and hitting a new high.
Major U.S. banks reported strong third-quarter earnings, enhancing confidence in the sector.
JPMorgan Chase & Co. (JPM) posted Q3 earnings of $4.37 per share, topping the $4.00 expected, and shares rose over 4% in early trading. Analyst Richard Ramsden described the results as a “strong beat.”
Wells Fargo & Co. (WFC) shares jumped 6.2% after reporting EPS of $1.42, exceeding expectations despite cautious guidance.
Bank of New York Mellon Corp. (BK) saw shares rise 1.8% following better-than-expected results.
BlackRock Inc. (BLK) gained 3.4% after reporting strong earnings, leading its shares to a record high.
Other banks like Bank of America (BAC), Citigroup (C), Goldman Sachs (GS), and Morgan Stanley (MS) each climbed between 2% and 4.8%.
This strength also lifted regional banks, with the SPDR S&P Regional Banking ETF (KRE) increasing by 3.5% and enhancing the Russell 2000 index by 1.3%.
Mixed Economic Data Overlooked by Strong Earnings
Fridays economic data showed a higher-than-expected Producer Price Index (PPI) and a disappointing Michigan Consumer Sentiment report.
The PPI increased to 1.8% year-over-year in September, beating the 1.6% forecast. Core producer prices rose from 2.6% to 2.8%, surpassing the expected 2.7%.
Consumer sentiment dropped to 68.9 in October from 70.1, below the 70.8 forecast. Inflation expectations also rose slightly.
Despite the mixed signals, investors remained optimistic due to strong bank earnings and looked forward to the corporate earnings season.
Top 5 Performers in the S&P 500 on Friday
| Stock | Sector | Price | 1-day Return (%) |
| Uber (UBER) | Industrials | 84.21 | 8.07% |
| Fastenal (FAST) | Industrials | 75.13 | 7.34% |
| Wells Fargo (WFC) | Financials | 60.99 | 5.61% |
| WW. Grainger (GWW) | Industrials | 1,079.38 | 5.29% |
| Bank of America (BAC) | Financials | 41.97 | 4.99% |
Top 5 Performers in the Dow on Friday
| Stock | Sector | Price | 1-day Return (%) |
| JPMorgan Chase (JPM) | Financials | 221.99 | 4.30% |
| Boeing (BA) | Industrials | 150.55 | 2.68% |
| Goldman Sachs (GS) | Financials | 513.51 | 1.94% |
| Intel (INTC) | Information Technology | 23.63 | 1.78% |
| American Express (AXP) | Financials | 274.73 | 1.58% |
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