Wall Street closed higher on Friday as investors assessed President Donald Trump’s latest remarks regarding trade relations with China and regional bank earnings reduced concerns about credit risks.
Trump admitted that his proposed 100% tariff on Chinese goods would be unsustainable but blamed Beijing for tightening control over rare earth exports, which led to the current trade stalemate. The tariffs, along with new export restrictions on critical software, are set to take effect on November 1.
Regional bank shares recovered after Thursday’s sharp drop. Zions Bancorporation and Western Alliance both saw rebounds despite previous concerns over loan losses and fraud lawsuits. Truist Financial gained 3.7% following stronger-than-expected third-quarter profits, while Zions climbed 5.8% and Western Alliance advanced 3.1%. The S&P Composite 1500 Regional Banks index rose 1.8%, and the broader financial sector gained 0.8%.
Investor sentiment was further supported by solid earnings from major banks such as JPMorgan, helping to kick off an optimistic third-quarter reporting season. Analysts now project S&P 500 company profits to increase 9.3% for the quarter. The S&P 500 index closed up 0.53% at 6,664.01, the Nasdaq added 0.52% to 22,679.98, and the Dow Jones Industrial Average rose 0.52% to 46,190.61.
Most sectors posted gains, led by consumer staples, which advanced 1.23%. For the week, the S&P 500 gained 1.7%, the Nasdaq climbed 2.1%, and the Dow rose 1.6%. The volatility index dropped to 21.5 after touching its highest level in nearly six months earlier in the day.
Among major companies, Tesla rose 2.5%, Apple gained nearly 2%, and Amazon slipped 0.7%. Eli Lilly fell 2% following Trump’s vow to lower weight-loss drug prices.
