S&P 500 in Rally Mode as Strong Economic Data Eases Recession Fears; Banks Rally

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© Reuters.

By Yasin Ebrahim

Investing.com — The S&P 500 jumped Friday, as better-than-expected economic data eased worries about the pace of slowing economic growth while Citi rallied following impressive quarterly results to help financials claw back losses from a day earlier.

The rose 1.7%, the rose 1.9%, or 584 points, and the was up 1.5%

Financials led the broader market higher, boosted by rallying bank stocks after Citigroup (NYSE:) reported better-than-expected , sending its shares more than 10% higher.

The Wall Street bank was helped by blowout performance in its trading business that offset weakness in investing banking revenue and an announcement that stock buybacks would be suspended.

Wells Fargo (NYSE:), meanwhile, surged 6% despite reporting that fell short on both the top and bottom lines as the bank set aside more money to cover potential losses from bad loans.

Banks stocks were also helped by steepening in yield curves as data showing the consumer remains in good shape eased some concerns the economy was headed for a significant slowdown.

rose 1.0% in June, the strongest pace in three months, and above expectations for a 0.8%.

Following the report, economists at Jefferies pointing to the fall in gas prices, signaled optimism for a further boost in the consumer spending that could set up the economy “for much stronger GDP growth in Q3.”

UnitedHealth Group Incorporated (NYSE:), a major Dow component, rose more than 2% after delivering stronger guidance as quarterly , driven by stronger performance in its Optum healthcare services business.

Technology continues its uptrend, led by gains in Amazon (NASDAQ:) and Meta Platforms (NASDAQ:) with the latter up more than 4%.

Amazon was in the spotlight after it said 300 million items were sold during its annual Prime Day Sales event. “Prime Day results make us incrementally more confident in the strength of the consumer, their willingness to spend post pull forward in COVID demand, and as a result AMZN’s forward topline growth,” Morgan Stanley said.

Twitter Inc (NYSE:) gained more than 2% as its case against Musk for terminating his $44 billion deal to take over the company, allegedly without cause, is expected to get underway on July 19.

“There are a range of possibilities that can come from the Delaware court including settlement, breakup fee paid, deal enforced, and a myriad of other outcomes,” Wedbush said in a note.

Pinterest (NYSE:) rallied more than 14% on reports activist investment firm Elliott Management reportedly took a 9% stake in the struggling social-media company, which has seen its shares slump about 50% year to date.