United States benchmark averages closed higher on Friday as traders welcomed signs of thawing trade tensions between Washington and Beijing and brushed aside lingering concerns over regional bank credit losses that had rattled markets a day earlier.
The Dow Jones Industrial Average gained 238.4 points, or 0.5%, to finish at 46,190.6. The S&P 500 rose 34.9 points, or 0.5%, to 6,664.0, while the Nasdaq Composite advanced 117.4 points, or 0.5%, to 22,680.0.
Sentiment improved after Treasury Secretary Scott Bessent said he expects to meet next week with Chinese Vice Premier He Lifeng in Malaysia, saying the two sides had “engaged in frank and detailed discussions regarding trade between the United States and China”.
The move offered reassurance to investors worried about the looming threat of 100% tariffs on Chinese goods due to take effect on November 1.
President Donald Trump also told reporters at the White House that a meeting with Chinese President Xi Jinping remained likely by the end of the month, further easing market tensions.
The prospect of renewed dialogue spurred a rally in stocks that had been hit hard in the previous session.
Regional bank shares rebounded after steep declines Thursday, when Zions Bancorporation disclosed losses tied to two commercial and industrial loans, and Western Alliance revealed a lawsuit alleging fraud by Cantor Group V, LLC.
By Friday’s close, Zions shares had surged 5.8%, while Western Alliance rose 3.1%.
Truist Financial also gained 3.7% after posting stronger third-quarter earnings, and Fifth Third Bancorp advanced 1.3% as its results beat expectations despite an uptick in credit losses linked to bankrupt subprime auto lender Tricolor.
Investment bank Jefferies, which had been caught up in Thursday’s sell-off over its exposure to bankrupt auto parts retailer First Brands, rallied 6% after Oppenheimer upgraded the stock to outperform. Jefferies had plunged 11% the day before.
Market volatility also cooled as the Cboe Volatility Index (VIX), Wall Street’s fear gauge, retreated following Thursday’s spike.
Despite a turbulent week, all three major indices ended higher. The S&P 500 advanced 1.7% for the week, the Dow rose 1.6%, and the Nasdaq gained 2.1%.
On the bond market, yields firmed as risk appetite returned. The 10-year Treasury yield climbed 0.9% to 4.011%, while the 2-year yield rose 1.2% to 3.464%.
