[BENGALURU] Wall Street ended higher on Friday (Oct 17) as investors assessed US President Donald Trump’s latest remarks on China, while quarterly results from regional banks eased concerns about credit risks.
Trump said that his proposed 100 per cent tariff on goods from China would not be sustainable, but blamed Beijing for the latest impasse in trade talks that began with Chinese authorities tightening control over rare earth exports. Trump unveiled the new tariffs a week ago, along with new export controls on “any and all critical software”, to go into effect on Nov 1.
“The market doesn’t really know what to take when Donald Trump speaks,” said Robert Pavlik, senior portfolio manager at Dakota Wealth. “There’s just a lot of back-and-forth comments with regards to China and trade tariffs and pretty much everything else.”
Regional bank stocks rebounded following a sell-off on Thursday, when Zions Bancorporation disclosed losses tied to two commercial and industrial loans and Western Alliance revealed it had initiated a lawsuit alleging fraud by Cantor Group V, LLC.
“There’s a lot more bark than bite on the credit fears,” said Jed Ellerbroek, a portfolio manager at Argent Capital. “Looking through all the big banks’ results, credit is very good. Overall, there are very few pockets of weakness.”
Truist Financial gained 3.7 per cent after the bank reported higher third-quarter profit. Fifth Third Bancorp rose 1.3 per cent, Zions shares rebounded from losses the day before to close 5.8 per cent higher, and Western Alliance advanced 3.1 per cent.
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The S&P Composite 1500 Regional Banks index climbed 1.8 per cent after tumbling almost 6 per cent the day before.
The S&P 500 financial sector index, which includes the largest US banks, rose 0.8 per cent.
Robust earnings from JPMorgan and other big banks this week helped get the third-quarter earnings season off to an upbeat start. Analysts on average see S&P 500 earnings climbing 9.3 per cent in the third quarter, an improvement from expectations of 8.8 per cent at the start of October, according to LSEG I/B/E/S.
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Following a rally of nearly 14 per cent in 2025, the S&P 500 is valued at 23 times expected earnings, its priciest level in five years.
The S&P 500 climbed 0.53 per cent to end the session at 6,664.01 points.
The Nasdaq gained 0.52 per cent to 22,679.98 points, while the Dow Jones Industrial Average rose 0.52 per cent to 46,190.61 points.
Nine of the 11 S&P 500 sector indexes rose, led by consumer staples, up 1.23 per cent.
For the week, the S&P 500 gained 1.7 per cent, the Nasdaq rose 2.1 per cent and the Dow climbed 1.6 per cent.
The CBOE volatility index, investors’ fear gauge, dropped to 21.5 points after hitting its highest level in nearly six months at 28.99 earlier in the day.
Wall Street’s most valuable companies were mixed, with Tesla rising 2.5 per cent, Apple adding almost 2 per cent and Amazon falling 0.7 per cent. Eli Lilly fell 2 per cent after Trump said he would bring down prices of weight-loss drugs. State Street dropped 1.4 per cent after the bank’s third-quarter net interest income missed estimates.
Advancing issues outnumbered falling ones within the S&P 500 by a 2.6-to-one ratio.
The S&P 500 posted seven new highs and six new lows; the Nasdaq recorded 37 new highs and 114 new lows.
Volume on US exchanges was relatively light, with 19.6 billion shares traded, compared with an average of 20.7 billion shares over the previous 20 sessions. REUTERS
