U.S. stocks closed out the trading week in positive territory as investors shook off concerns about a U.S.-China trade war and credit concerns among regional banks.
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The blue-chip Dow Jones Industrial Average closed 238 points, or 0.52%, higher. The benchmark S&P 500
gained 0.53%, while the Nasdaq ended the week up 0.52%. Stocks rallied in afternoon trading after U.S. Treasury Secretary Scott Bessent said he would speak with his Chinese trade counterpart.
Additionally, U.S. President Donald Trump said that a planned meeting with China President Xi Jinping was still likely to occur at the end of October. The comments helped ease investor worries that Trump’s threat of 100% additional tariffs on Chinese imports starting Nov. 1 might happen.
Bank Worries
Worries about bad loans at regional American banks also appeared to subside. Shares of banks that fell sharply the day before rebounded as investors and traders bet that any bad credit is a one-off and unlikely to lead to widespread contagion or a bigger crisis.
Regional lenders Zions (ZION) and Western Alliance (WAL) disclosed bad loans earlier in the week, causing a big selloff in their stocks and the wider banking sector. However, ZION stock climbed 5% higher on Oct. 17 after receiving an analyst upgrade. Better-than-expected financial results from Fifth Third Bancorp (FITB) also helped to ease investor concerns.
Is the SPDR S&P 500 ETF Trust a Buy?
The SPDR S&P 500 ETF Trust (SPY) currently has a Moderate Buy rating among 504 Wall Street analysts. That rating is based on 421 Buy, 78 Hold, and five Sell recommendations issued in the last three months. The average SPY price target of $756.35 implies 14.18% upside from current levels.
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