Markets end week with a rally, despite geopolitical turmoil
U.S. stocks saw a rebound Friday, one day after a series of tumultuous world events led to a widespread sell-off.
The Dow Jones industrial average closed the day up 123 points, while the Nasdaq composite index was up 1.6% and the broad S&P 500-stock index climbed 1%. All three blue-chip indices finished up for the week with 5-day increases of 0.92% (Dow Jones), 0.54% (S&P 500) and 0.38% (Nasdaq).
On Thursday, U.S. stocks indexes tumbled while Treasuries rallied, along with gold, after the crash of a passenger jet in Ukraine sparked demand for safe-haven assets.
The U.S. said the Malaysia Airlines jet that crashed was likely downed by a ground-to-air missile fired by pro-Russian rebels. Both Russia and the Ukrainian separatist groups it backs have denied responsibility for the crash, but the incident has raised concerns over the ongoing political turmoil between Ukraine and Russia.
Additionally, Israel launched a ground offensive in the Gaza Strip Thursday evening after over a week of fighting between the country and Hamas militants.
But given a night to sleep on the events, along with a lack of any major subsequent market-shaking news Friday, the markets rebounded from their losses.
Friday’s rally lifted the Dow back above 17,000 points, having fallen below that level on Friday after a 161-point drop in the prior session. Both the S&P 500 and the Nasdaq were also back up to close out the week after tumbling Thursday. What’s more, the Chicago Board Options Exchange Volatility Index (VIX), which is sometimes called the “fear index,” dropped almost 16%, to 12.24, on Friday after soaring to its highest point in three months amid the turmoil a day earlier.
Top individual performers on Friday included Google, which rose 3.7% after reporting second quarter fiscal results that outpaced estimates. Dublin-based Shire’s shares jumped 1.4% after it officially announced its sale for $54 billion to U.S. drugmaker AbbVie, which saw its own shares rise 2.6%.
Meanwhile, gold and oil futures were ticking downward Friday after both experienced a jump on Thursday. Brent and WTI crude oil futures were down 0.8% and 0.2%, respectively, while gold futures fell 0.4%.