With the market playing in front of a Friday crowd that had one eye on a three-day weekend, it seemed a pretty good bet that the momentum pushing stocks higher for more than four months was more likely than not to continue.
The bulls weren’t disappointed.
Stocks posted broad-based gains on Friday, continuing the rally that now has the market up 2% in 2011 alone.
The Dow Jones Industrial Average rose 55 points to just-another-one-of-those-new-two-year-highs at 11,787; the Nasdaq tacked on 20 points to 2755; while the S&P 500 gained 9 points to 1293.
Not that the market wasn’t given some positive developments upon which to hang another push higher: JPMorgan Chase (NYSE:JPM) virtually owned a 16-hour news cycle from Thursday’s close into Friday’s opening bell, thanks to a bullish outlook on the financial sector from the company’s chief executive and a blowout fourth-quarter earnings report.
JPMorgan shares rose 1% to $44.92, helping to lift both the Dow and financial stocks as a whole. The SPDR Financial Select Sector (NYSE:XLF) exchange-traded fund finished up 1.6% to $16.72, and is now up more than 15% since the end of November.
Tech stocks also had a strong day, ironically due in part to a positive earnings report from Intel (NASDAQ:INTC), which itself ended lower on the day. The Semiconductor HOLDRS (NYSE:SMH) ETF rose 2.6%, while current chip-stock superstar (NASDAQ:NVDA), which has seen its shares climb 57% since Dec. 30, rose again on Friday.
Microsoft (NASDAQ:MSFT) also rallied, and, like Intel, boosted the Dow and Nasdaq alike.
The bullishness surrounding financial stocks is nothing particularly new, of course, and that sector’s runup since early December has been no small part of the overall market’s hyper-surge since then. Still, the current investor mindset is one that is taking most news and data as positive whether or not it’s new and/or positive.
Earlier Friday, for example, traders were told that consumer prices jumped by their highest rate since June 2009, while gas prices alone soared 8.5% in December. The government’s report on December retail sales, meanwhile, missed expectations.
A skeptic would probably point out these don’t seem like positive developments for a sustained economic recovery. But a skeptic probably missed out on most of the recent rally in stocks.