US Stocks End Higher, Buoyed By Hopes Of Recovery

The S&P 500 and the Dow ended a seesaw week higher as investors rebalancing their portfolios at the quarter's end continued to buy stocks that stand to benefit from a growing economy while they added some beaten-down technology shares.

The Nasdaq also ended higher, lifted by less popular tech shares, as the composite index posted its second weekly decline in a row.

Wall Street surged in the last half hour of trading.

Many tech heavyweights slid, such as Tesla, Apple, Amazon and Google parent Alphabet, but Microsoft and Facebook bucked the trend, helping lift the S&P 500 higher.

"It is less a move out of technology than a move that evidences a broader appetite for equities to include both growth and value," said John Stoltzfus, chief investment strategist at Oppenheimer Asset Management in New York.

The Dow Jones Industrial Average rose 1.4 percent to 33,072, the S&P 500 gained 1.7 percent to 3,974 and the Nasdaq Composite added 1.2 percent to 13,138.

L Brands jumped after the Victoria's Secret owner raised its current-quarter profit forecast for the second time this month as it benefits from consumers spending their stimulus checks and relaxation of Covid-19 restrictions.

The Federal Reserve last week raised its GDP estimate for 2021 to 6.5 percent from 4.2 percent and many economists expect still faster growth, which has spurred fears the economy could run too hot and force the Fed to raise interest rates.

"It has been hard to restrain our US growth forecast in recent months. We've been upgrading our estimates almost as fast as we lowered them a year ago," Carl Tannenbaum, chief economist at Northern Trust, told the Reuters Global Markets Forum.

Bank stocks gained as the Fed said it would lift income-based restrictions on bank dividends and share buybacks for "most firms" in June after its next round of stress tests.

The yield on benchmark 10-year US Treasury notes rose to 1.66 percent, lower than a spike last week to 1.75 percent that sparked a selloff on inflation fears and a potential Fed rate hike - something the Fed has pledged not to do.

The market is concerned that all of a sudden the Fed is forced to tighten against its repeated mantra that it will not, said Marvin Loh, a senior global macro strategist at State Street Global Markets.

"The real concern is that things overheat and the Fed might be forced to change its mind," he said.

Energy stocks jumped, tracking a boost in crude prices after a giant container ship blocking the Suez Canal spurred fears of a supply squeeze.

Latest data showed US consumer spending fell by the most in 10 months in February as a cold snap gripped many parts of the country and the boost from a second round of stimulus checks faded, though the decline is likely temporary. (Reuters)