Traders work at the New York Stock Exchange on Dec. 17, 2024.
NYSE
The Dow Jones Industrial Average bounced on Friday to close out a tough week that saw the index plunge 1,100 points in a single day and complete its longest losing streak since the 1970s. Some cooler-than-expected inflation data helped fuel the session's bounce.
The 30-stock Dow gained 498.02 points, or 1.18%. The S&P 500 added 1.09%, while the Nasdaq Composite advanced 1.03%
November's reading of the personal consumption expenditures price index – the Federal Reserve's preferred inflation metric – increased 2.4% year-over-year. That was a tad less than economists expected and helped defuse some of the bearishness that arose earlier this week when the Fed said it would dial back future rate cuts in part because of stubborn inflation.
The 30-stock Dow is on track for a roughly 2% decline on the week.
Chicago Fed President Austan Goolsbee told CNBC's Steve Liesman he was encouraged by Friday's inflation figures and that rates could still decline next year despite the central bank's cautious stance.
"We're still on path to get to 2% and at least for this new month you don't want to make too much out of any one month, but I'm hopeful that this suggests that the couple of months of firming were more of a bump than a change in path," Goolsbee said. Major indexes jumped intraday following Goolsbee's comments.
It's a positive end to a tumultuous week. During Thursday's trading session, the Dow eked out a 15-point gain and ended a 10-day losing streak — its longest since 1974. The small gain came a day after the Dow plunged 1,100 points on Wednesday. The Fed's indicating just two cuts next year, instead of the four it originally forecast, was the catalyst for the decline.
"Today has calmed people down," said Tom Fitzpatrick, managing director at R.J. O'Brien and Associates. "[It's] unlikely we get a downside catalyst now ahead of Christmas and New Year's, so [the] moves of the last few days can get unwound a bit."
Weighing on sentiment still a bit Friday was the failure Thursday night of a Trump-endorsed House Republican measure to fund the government for three months and avert a government shutdown. Without a deal, a partial shutdown is slated to start Friday night.
After Friday's jump, the Dow was on pace for a 2% loss for the week.
– CNBC's Sarah Min and Christina Wilkie contributed to this report.
