Dow and S&P 500 Rise to Records on More Evidence of Global Recovery

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Stocks rose Friday as soaring growth in China provided investors with further reasons to believe in a surging post-pandemic recovery.

The Dow Jones Industrial Average jumped 180 points, or 0.53%, to 34,216, and the S&P 500 gained 0.23%. The Nasdaq fell 0.14%.

The Dow and S&P 500 set intraday all-time highs on Friday.

The Dow closed at a record high of 34,035 on Thursday and the S&P 500 reached an all-time high after U.S. retail sales and jobless claims and solid earnings reports pointed to a recovering domestic economy.

“Stellar jobless claims plus off the charts retail sales packs a positive one-two punch and sends strong signals that the economy is full steam ahead toward recovery,” said Mike Loewengart, managing director of investment strategy at E*Trade. “While we haven’t necessarily seen the market move on strong economic beats or misses, it’s certainly a step in the right direction. And with earnings season off to a solid start, the case for continued bullishness should not be ignored,” Loewengart added.

The yield on the 10-year U.S. Treasury edged higher Friday to 1.573%. The 10-year Treasury note sank Thursday to 1.531%, the lowest in four weeks.

In China, gross domestic product jumped a record 18.3% in the first quarter. The figures were magnified by comparisons with a year earlier when the economy was locked down because of the coronavirus outbreak.

Economists expect the brisk expansion in China, the world’s second-largest economy, to moderate as manufacturing and consumer spending return to normal.

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Morgan Stanley  (MS) – Get Report posted much stronger-than-expected first-quarter earnings on the strength of record wealth management inflows and surging investment banking revenue. Wealth management inflows surged to a record $105 billion during the quarter. 

The company also unveiled a $900 million loss linked to the collapse of Archegos Capital, with CEO James Gorman noting the cost of de-risking from the failed hedge fund was “money well spent.”

Bitcoin tumbled Friday after Turkey’s central bank issued a ban against the use of cryptocurrencies for payments in the country starting from the end of the month.

In a statement, the Central Bank of the Republic of Turkey said it will ban bitcoin and other non-fiat currencies from being used for several reasons, including a lack of “supervision mechanisms” and “central authority regulation” for crypto assets.

The benchmark cryptocurrency slipped 2.79% to $61,1999 after reaching all-time highs above $64,000 earlier this week ahead of crypto exchange platform Coinbase Global’s  (COIN) – Get Report initial public offering. 

Coinbase, meanwhile, rose 1% to $325.85. The funds of star manager Cathie Wood have purchased about $352 million worth of shares in Coinbase over two days.