NEW YORK (AP) — U.S. stocks rose to records Friday as big banks rallied following a run of reassuring profit reports.
The S&P 500 climbed 0.6% to top its all-time high set earlier in the week and close out its fifth straight winning week, while the Dow Jones Industrial Average jumped 409 points, or 1%, to set its own record. The Nasdaq composite lagged the market with a gain of 0.3% after a slide for Tesla kept it in check.
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FILE - The New York Stock Exchange is shown on Sept. 10, 2024. in New York. (AP Photo/Peter Morgan, File)
Passersby move past an electronic stock board showing Japan's Nikkei 225 index outside a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
An electronic stock board shows Japan's Nikkei 225 index at a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
A passerby moves past an electronic stock board showing Japan's Nikkei 225 index and stock prices outside a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
A passerby walks past an electronic stock board showing Japan's Nikkei 225 index, center, in front of a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
Wells Fargo rose 5.6% after reporting stronger profit for the latest quarter than analysts expected. It benefited from better results from its venture-capital investments and higher fees for investment-banking services, among other things.
Banks and other financial giants traditionally kick off each earnings reporting season, and JPMorgan Chase climbed 4.4% after reporting a milder drop in profit than analysts feared. It was the strongest single force pushing upward on the S&P 500.
CEO Jamie Dimon said the nation’s largest bank is also still buying back shares of its stock to send cash to investors, but the pace is modest “given that market levels are at least slightly inflated.”
BlackRock, meanwhile, rose 3.6% after likewise delivering better profit for the latest quarter than analysts expected. The investment giant ended September managing a record $11.5 trillion in total assets for its customers.
The gains for banks helped make up for the drag of Tesla, which tumbled 8.8% and was the heaviest weight on the market. The electric-vehicle maker unveiled its long-awaited robotaxi on Thursday night, but critics highlighted a lack of details about its planned rollout.
Following the unveiling of the “Cybercab,” potential rival Uber Technologies jumped 10.8% and was one of the strongest forces lifting the S&P 500. Lyft rose 9.6%.
All told, the S&P 500 rose 34.98 points to 5,815.03. The Dow rallied 409.74 to 42,863.86, and the Nasdaq composite gained 60.89 to 18,342.94.
Another automaker, Stellantis, saw its European-traded shares sink 2.8% after it announced some significant leadership changes, including the timing of CEO Carlos Tavares’ retirement. Its chief financial officer is also departing as the company formed by the merger of PSA Peugeot and Fiat Chrysler struggles to revive sales in North America.
In the bond market, Treasury yields were mixed following the latest updates on inflation at the wholesale level and on sentiment among U.S. consumers.
Prices paid by producers were 1.8% higher in September than a year earlier. That was an improvement from August’s year-over-year inflation level, but not as much as economists expected. Analysts said it likely helped calm worries stirred a day earlier, when a report showed inflation at the consumer level wasn’t cooling as quickly as economists expected.
A separate report on Friday suggested sentiment among U.S. consumers is lower than economists expected. But the preliminary reading's decline in sentiment was still within the margin of error, according to Joanne Hsu, director of the University of Michigan's Surveys of Consumers.
After Friday’s reports, traders built their bets that the Federal Reserve would cut its main interest rate by a quarter of a percentage point at its next meeting, according to data from CME Group.
They've pared back their expectations from earlier this month, when some traders were betting on the possibility for another larger-than-usual cut of half a percentage point in November. A run of stronger-than-expected data on the economy recently has wiped out such calls.
Regardless of how much the Fed cuts rates by at its next meeting, the longer-term trend for interest rates remains downward, according to Solita Marcelli, chief investment officer Americas, at UBS Global Wealth Management. That should offer an upward push to stock prices generally.
The Fed last month cut its main interest rate from a two-decade high as it widens its focus to include keeping the economy humming instead of just fighting high inflation.
The yield on the 10-year Treasury rose to 4.09% from 4.07% late Thursday. The two-year yield, which more closely tracks expectations for the Fed’s upcoming moves, edged down to 3.95% from 3.96%.
In markets abroad, stocks fell 2.5% in Shanghai for their latest sharp swing ahead of a briefing scheduled for Saturday by China’s Finance Ministry. Investors hope it will unveil a big stimulus plan for the world's second-largest economy.
South Korea's Kospi slipped 0.1% after its central bank cut interest rates for the first time in more than four years in hopes of boosting its economy.
AP Business Writers Matt Ott and Zimo Zhong contributed.
FILE - The New York Stock Exchange is shown on Sept. 10, 2024. in New York. (AP Photo/Peter Morgan, File)
Passersby move past an electronic stock board showing Japan's Nikkei 225 index outside a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
An electronic stock board shows Japan's Nikkei 225 index at a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
A passerby moves past an electronic stock board showing Japan's Nikkei 225 index and stock prices outside a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
A passerby walks past an electronic stock board showing Japan's Nikkei 225 index, center, in front of a securities building Friday, Oct. 11, 2024 in Tokyo. (AP Photo/Shuji Kajiyama)
WASHINGTON (AP) — Donald Trump has had few defenders in Congress as reliable as Matt Gaetz, who has thundered at one prosecutor after another for perceived bias against the president-elect and emphatically amplified the Republican's rallying cry that the criminal investigations into him are “witch hunts.”
That kinship was rewarded Wednesday when Trump named Gaetz as his pick for attorney general, turning to a conservative loyalist in place of more established lawyers who'd been seen as contenders.
In announcing his selection of Gaetz as attorney general and John Ratcliffe a day earlier as CIA director, Trump underscored the premium he places on loyalty, citing both men's support for him during the Russia investigation as central to their qualifications and signaling his expectation that leaders in his administration should function not only as a president's protector but also as an instrument of retribution.
The dynamic matters at a time when Trump, who will enter office in the wake of two federal indictments expected to soon evaporate and a Supreme Court opinion blessing a president's exclusive authority over the Justice Department, has threatened to pursue retaliation against perceived adversaries.
“Matt will root out the systemic corruption at DOJ, and return the department to its true mission of fighting Crime, and upholding our Democracy and Constitution. We must have Honesty, Integrity, and Transparency at DOJ,” Trump wrote in a social media post about Gaetz, a Florida Republican.
The rhetoric from Trump reflects an about-face in approach from President Joe Biden, who has repeatedly taken a hands-off approach from the Justice Department even while facing a special counsel investigation into his handling of classified information and as his son, Hunter, was indicted and convicted on tax and gun charges.
Democrats immediately sounded the alarm, with Sen. Dick Durbin, the Democratic chairman of the Senate Judiciary Committee, saying Gaetz “would be a disaster” in part because of Trump's threat to use the Justice Department “to seek revenge on his political enemies.” The president of Common Cause, a good government group, called the selection “shocking" and “a serious threat to the fair and equal enforcement of the law in our nation.” Even several Senate Republicans expressed concern about the Gaetz pick.
That Trump would openly value Gaetz's role in “defeating the Russia, Russia, Russia Hoax, and exposing alarming and systemic Government Corruption and Weaponization” is not altogether surprising. In his first term, Trump fired an FBI director who refused to pledge loyalty to him at a private White House dinner and an attorney general who recused himself from the Justice Department's investigation into potential ties between Russia and his 2016 presidential campaign.
“I think this selection indicates that President-elect Trump was looking for an attorney general whose views were closely aligned with him with respect to the appropriate role of the Department of Justice,” said former federal prosecutor Robert Mintz.
Ratcliffe, who served as Trump's director of national intelligence in the final months of his first term, rose to prominence on Capitol Hill as a staunch defender of Trump. He was a member of Trump's advisory team during his first impeachment hearings in 2019 and pointedly grilled multiple witnesses about the Russia investigation — including an FBI agent who led the inquiry but also traded anti-Trump text messages with a colleague.
That work was credited by Trump in his selection announcement, as he praised Ratcliffe for “exposing fake Russian collusion” and having “been a warrior for Truth and Honesty with the American Public.”
Gaetz would be the first attorney general in decades without Justice Department experience, and in recent years became embroiled himself in a federal sex trafficking investigation that ended without criminal charges.
Hours before the announcement, Gaetz said in a social media post that there needs to be a “full court press against this WEAPONIZED government that has been turned against our people.” He added: “And if that means ABOLISHING every one of the three letter agencies, from the FBI to the ATF, I’m ready to get going!” If confirmed as attorney general, he would oversee both the FBI and the ATF.
Advancing the theme of vengeance, billionaire Trump supporter Elon Musk weighed in on the Gaetz appointment with a post that said: “The Hammer of Justice is coming.”
Gaetz has used the seat in Congress he first won in 2016 to rail against the Justice Department, repeatedly decrying what he — and Trump — contends is a criminal justice system biased against conservatives. He has blasted law enforcement officials he has perceived as being either overtly anti-Trump or ineffective in protecting Trump's interests.
When Robert Mueller visited Capitol Hill to discuss the findings of the Russia investigation, Gaetz condemned the prosecutor for leading a team that the congressman said was “so biased.” The Trump Justice Department appointed a special prosecutor, John Durham, to examine errors in the Russia investigation, but Gaetz scolded Durham too for failing to uncover enough damaging information about the FBI's inquiry into Trump.
“For the people like the (committee) chairman who put trust in you, I think you let them down. I think you let the country down. You are one of the barriers to the true accountability that we need,” Gaetz said.
He's directed outright fury at FBI Director Christopher Wray, snapping at him last year that FBI applicants in Florida “deserve better than you” and at the current attorney general, Merrick Garland. In 2022, Garland appointed special counsel Jack Smith to investigate Trump's hoarding of classified documents at his Mar-a-Lago estate in Florida and his efforts to overturn the 2020 presidential election.
Both investigations ended in indictments expected to wind down before Trump takes office. Smith, too, is also likely to be gone by the time Gaetz arrives and a new FBI director is also expected to be appointed given Trump's lingering discontent with Wray, his own appointee.
“None of us can predict exactly what will happen there,” said Ryan Fayhee, a former Justice Department national security prosecutor.
He added: “I think it's just more of a question of the department continuing to be independent and largely resting on the broad shoulders of the career prosecutors and agents that have held themselves to the highest standards.”
FILE - Director of National Intelligence John Ratcliffe waits to board Marine One with President Donald Trump on the South Lawn of the White House in Washington, Dec. 12, 2020. (AP Photo/Patrick Semansky, File)
FILE - Rep. Matt Gaetz, R-Fla., speaks on Capitol Hill in Washington, March 12, 2024. (AP Photo/Nathan Howard, File)