“What a difference one week can make,” said Steve Sosnick of Interactive Brokers. “This time last Friday, stocks were selling off sharply on the back of a better-than-expected jobs report. It revealed a lot about stocks There seems to be a clear preference for lower interest rates rather than a solid economy.”

From a technical perspective, Janney Montgomery Scott's Dan Wantrobski said this setup is "almost perfect for oversold conditions to collide with positive news and trigger the rally we're currently experiencing."

Stock investors will have one big reason to breathe a sigh of relief when Trump is sworn in as the next President of the United States on Monday. History shows that performance of equity benchmarks over a three-month period typically improves after Inauguration Day.

History shows the S&P 500 averaged just about 1% in the three months leading up to the ceremony and was up 3.7% by the end, according to a Jefferies analysis of data going back to 1929.

The index "is typically more volatile around the inauguration," but things started to improve a few months later, the firm's strategists said. In fact, the S&P gained an average of 8.3% in the six months after the inauguration and about 9.5% in the 12 months after the inauguration, according to Jefferies.

Bank of America strategists said Trump's return to the White House could protect U.S. stocks from a sharp sell-off as investors focus on his protectionist agenda and proposals to lower corporate taxes.

U.S. stocks are "protected" from downside by Trump, strategist Michael Hartnett wrote in a note, but he also doesn't expect U.S. stocks to be heavily concentrated in Big Tech stocks , valuation and investor positions and other risks have risen sharply.

"We continue to view U.S. equities as attractive and expect 9% earnings growth this year to push the S&P 500 to 6,600 by year-end," said Mark Haefele of UBS Global Wealth Management. “Given their larger investments in AI, better earnings trends and lower reliance on Fed rate cuts, large-cap stocks should outperform small and mid-cap stocks.

From an industry perspective, he likes information technology, financials, utilities, communications services and consumer discretionary.

"U.S. equities have significantly outperformed U.S. equities over the years, so it's difficult to look at opportunities outside the U.S. and think they will be more attractive," said Zerid Osmani of Martin Currie Investment Management. "But valuation discipline has to be an important perspective for investors right now as we need to see earnings momentum expand."

Company Highlights:

• Microsoft Corp's $13 billion investment in OpenAI has fueled concerns the tech giant could extend its dominance in cloud computing to emerging markets, the Federal Trade Commission said in a report released on Friday. Artificial Intelligence Market.

• The Supreme Court unanimously upheld a law that threatens to shut down the popular TikTok social media platform in the United States as early as Sunday, ruling that free speech rights must yield to concerns that China's control of the app poses national security risks.

• U.S. auto safety regulators are investigating General Motors over concerns that more than 870,000 of its full-size pickup trucks and SUVs are at risk of engine failure.

• Applied Materials Inc. and Lam Research Corp. were upgraded to Overweight from Sector Weight as KeyBanc Capital Markets repositions the half-cap investment universe as immediate growth drivers.

• JB Hunt Transport Services Inc. reported fourth-quarter earnings that fell short of estimates and warned of first-quarter results and cost pressures into 2025.

• Bank of America downgraded JetBlue Airways and Southwest Airlines to underperform from neutral, citing their lower exposure to corporate, premium and international routes.

• Novo Nordisk A/S's blockbuster drug Wegovy is targeted by the U.S. government for price cuts and suffers setbacks in new trials, putting the Danish company's early dominance in the emerging market for weight-loss treatments at risk. A growing threat.

• Bumble Inc. founder Whitney Wolfe Herd is returning to the dating app company as CEO, a year after she handed the reins to a Slack Technologies Inc. Executives.

Some major trends in the market:

stock

• The S&P 500 was up 1% as of 4 p.m. New York time

• The Nasdaq 100 rose 1.7%

• The Dow Jones Industrial Average rose 0.8%

• MSCI World Index rose 0.8%

• Bloomberg Magnificent 7 Total Return Index rose 1.8%

• Russell 2000 index rose 0.4%

currency

• The Bloomberg Dollar Spot Index rose 0.3%

• The euro fell 0.3% to $1.0275

• Sterling fell 0.6% to $1.2170

• JPY/USD falls 0.6% to 156.15

cryptocurrency

• Bitcoin rises 4.9% to $105,064.59

• Ethereum rises 5.9% to $3,514.99

bond

• The 10-year Treasury bond yield changed little at 4.61%

• German 10-year government bond yields fell 1 basis point to 2.54%

• UK 10-year government bond yields fell two basis points to 4.66%

commodity

• West Texas Intermediate crude fell 0.9% to $77.95 a barrel

• Spot gold fell 0.5% to $2,701.21 an ounce

This story was produced with the assistance of Bloomberg Automation.

--With assistance from Isabelle Lee, Sujata Rao, Margaryta Kirakosian, and John Viljoen.

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