In advance of Fed Week, Wall Street soars to a substantially higher closing

As favourable economic statistics and a more optimistic profit outlook boosted investor risk appetite ahead of the Federal Reserve's highly anticipated two-day policy meeting next week, a strong, broad-based rally sent Wall Street to a substantially higher close on Friday.

The S&P 500 and the Nasdaq both saw gains for the second consecutive week, and all major U.S. indexes finished the session with gains of at least 2.5%. The blue-chip Dow scored its greatest weekly percentage rise since May and its fourth straight Friday-to-Friday gain.

Ryan Detrick, chief market strategist at Carson Group in Omaha, stated that this has been one of the strongest months (so far) in the history of the Dow, indicating that the bear market has most certainly finished. "Historically, big monthly swings have occurred at the conclusion of bear markets."

The fact that we have witnessed robust purchasing on two consecutive Fridays suggests that investors are becoming more at ease with holding over the weekend, according to Detrick.

Following the release of the results for the two market leaders, Apple Inc.'s 7.6% increase lessened the impact of the 6.8% decline in Amazon.com shares.

The combined profit projections for the quarter have been brightened by strong earnings beats from Chevron, Exxon Mobil, and other businesses outside the tech and tech-adjacent megacap category.

Refinitiv data shows that analysts now expect third-quarter S&P 500 earnings growth of 4.1%, up from 2.5% on Thursday.

Detrick stated that "we've seen several high-profile misses from important large-cap names." However, many smaller and medium businesses have shown pretty excellent earnings results on the surface.

According to CME's FedWatch tool, financial markets currently expect the Fed to raise interest rates by 75 basis points for a fifth time in a row at the end of its policy meeting on November 1-2, with a 51.4% chance that the Fed would slow its rate hikes to 50 basis points in December.

Compared to a month ago, Detrick said, "the door is cracked wide on the chance that we would see a more dovish Fed at December's policy meeting.

The Nasdaq Composite increased 309.78 points, or 2.87%, to 11,102.45, the S&P 500 increased 93.76 points, or 2.46%, to 3,901.06, and the Dow Jones Industrial Average increased 828.52 points, or 2.59%, to 32,861.8.

All but one of the S&P 500's 11 key sectors, consumer discretionary stocks, which were hurt by falling Amazon stock prices, finished the session in the black. The highest percentage gain was seen in tech shares.

The halfway mark of the third quarter reporting season has been reached with 263 S&P 500 companies having submitted their reports. Refinitiv reports that 73% of those have outperformed expectations.

While T-Mobile US Inc.'s subscriber prediction boost brought its shares up 7.4%, Intel Corp.'s share price increased by 10.7% as a result of decreasing its spending plan.

The delisting of Twitter Inc. from the New York Stock Exchange puts an end to Tesla Inc. CEO Elon Musk's $44 billion acquisition of the business.

On the New York Stock Exchange, advancers outweighed decliners by a ratio of 2.87 to 1, while the Nasdaq favoured advancers by a ratio of 2.12 to 1.

The Nasdaq Composite registered 117 new highs and 115 new lows, while the S&P 500 produced 32 new 52-week highs and eight new lows.

11.26 billion shares were traded on U.S. exchanges, down from the average of 11.53 billion for the previous 20 trading days.