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Stocks jumped out of the gate and rallied into the close as market participants went bargain hunting following this week’s drubbing. Indeed, tech stocks, which bore the brunt of the recent selling, saw some of the biggest gains, while crypto-adjacent names surged as bitcoin bounced.
At the close, the blue-chip Dow Jones Industrial Average was up 2.5% at 50,115 and the broader S&P 500 was 2% higher at 6,932 – their biggest one-day gains since last May and a new record high for the Dow. The tech-heavy Nasdaq Composite climbed 2.2% to 23,031 for its best day since November.
Friday’s rally wasn’t enough for the S&P 500 and Nasdaq to close with weekly gains, but the Dow finished the week up more than 2%.
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Strategy, Robinhood lead S&P 500 as bitcoin bounces
Drilling down on individual stocks, software company turned bitcoin holder Strategy (MSTR) was the best-performing S&P 500 component today, surging 26.1%. Online trading platform Robinhood Markets (HOOD) came in a distant second with its 14% gain.
The upside was sparked by a big rebound in bitcoin, which gained more than 9% today after crashing to its lowest level since October 2024 on Thursday.
“Speculative energies are back and propelling risk assets, with cryptocurrencies and commodities appreciating across the board following a colossal 50% drawdown in bitcoin’s price,” says José Torres, senior economist at Interactive Brokers.
Torres adds that a weakening U.S. dollar and a declining Cboe Volatility Index (VIX) underscore the “lack of safe-haven demand,” with “every major stock benchmark” and nearly all the main sectors advancing.
Tech, industrial stocks outperform
Technology easily outpaced the 11 S&P 500 sectors on Friday, rising 4.1% on strength in several mega-cap stocks, including Nvidia (NVDA, +7.9%), Broadcom (AVGO, +7.2%) and Advanced Micro Devices (AMD, +8.3%).
Industrial stocks were also notably higher on Friday thanks in part to Caterpillar’s (CAT) 7.0% surge. Shares are now up nearly 9% since the construction giant disclosed its fourth-quarter results on January 29.
The print “gave investors everything one could hope for,” says Truist Securities analyst Jamie Cook, including “a high-quality earnings beat, a guide with room for upside, better-than-expected retail sales and a massive backlog number.”
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Cook has a Buy rating on the Dow Jones stock and a $786 price target, representing implied upside of more than 8% to current levels.
Amazon sheds $133 billion in market value on Friday
Not all of the day’s price action was higher, though. Amazon.com (AMZN) took a notable post-earnings tumble to end the week – sinking 5.6% and losing $133 billion in market value along the way, equivalent to the entire market cap of energy firm ConocoPhillips (COP).
While the e-commerce and cloud giant’s fourth-quarter revenue of $213.4 billion beat estimates on strong Amazon Web Services (AWS) sales, its earnings of $1.95 per share fell short of the $1.97 Wall Street expected.
Additionally, the company’s forecast for $200 billion in capital expenditures this year sparked concern over the return on investment from its artificial intelligence initiatives.
“The increase in spending will remain an overhang as investors digest the guide and will likely need to see more tangible returns before regaining comfort,” says Wedbush analyst Scott Devitt.
Stellantis spirals on $26 billion write-down, dividend suspension
Stellantis (STLA) was another massive decliner today, sinking 24% after the Jeep parent said it will incur a 22.2 billion euro (roughly $26 billion) charge related to a restructuring of its electric vehicle strategy.
“We are resetting our product plan and our EV supply chain to reflect much more real customer demand and shifting regulation following an initial overestimation of pace of adoption of electrification in the regions,” said Stellantis CEO Antonio Filosa in the company’s earnings call.
The automaker also said that it will suspend its dividend in 2026 due to its 2025 net loss, which it says “will contribute to preserving a strong balance sheet.”
Next week brings jobs, inflation data
While next week’s earnings calendar remains jam-packed, with Coca-Cola (KO) and Spotify (SPOT) among the many names reporting, the economic calendar brings some key updates as well.
First up is Wednesday morning’s release of the January jobs report, delayed from its initial release due to the short-lived government shutdown. And on Friday, Wall Street will see the January Consumer Price Index (CPI) report.
Wells Fargo economists expect “a cleaner read on inflation” this time around as distortions from last fall’s shutdown-delayed data fade.
As for the jobs report, the economists think the data will “leave the tepid picture of the labor market little changed,” though the 80,000 new jobs they forecast is better than the 50,000 jobs added in December.
