- The S&P 500 closed positive for the year on Friday for the first time in 2016 as the U.S. Federal Reserve’s dovish tone and a strengthening economic outlook compelled investors to take on more risk.
- In part, the rally was a continued reaction to the Fed’s move on Wednesday, in which it scaled back expectations for the number of rate hikes in the coming months. Major indexes gained for five weeks in a row and the Dow closed higher every day this week.
- “It was a huge gift to the market,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia. “I think the market was bracing for a more hawkish view.”
- The Dow Jones industrial average closed positive for the year for the first time in 2016 on Thursday.
- Following the Fed move, the dollar weakened and drove up commodity prices. Oil rose above $42 a barrel.
- “People are realizing that this means a weaker dollar and that should benefit a lot of the stocks in the S&P and Dow, stocks with lots of exposure overseas,” said Kim Forrest, research analyst at Fort Pitt Capital Group in Pittsburgh.
- Crude oil dipped on Friday as traders booked profits after strong seasonal demand and the U.S oil rig count rose for the first time since December.