U.S. stocks bounced higher on Friday, more than reversing a down first day of trading to start 2025.
The broad S&P 500 index closed up by about 74 points, 1.3%, at 5,942. The tech-heavy Nasdaq jumped 341 points, about 1.8%, to close at 19,622. The Dow Jones Industrial Average closed at 42,732, up nearly 340 points.
Friday's gains followed a down day on Thursday. "The market was somewhat oversold," said Mark Luschini, chief investment strategist, president and chief investment officer for Janney Capital Management. "That was a setup for a rebound."
A report from the Institute for Supply Management that came in stronger than expected may have helped kindle investor sentiment Friday, Luschini told USA TODAY. ISM's manufacturing index signaled overall modest contraction in the sector in December, but the sub-measure that tracks new orders was sharply higher, suggesting better economic activity ahead.
Investors also appeared to be looking past recent concerns about higher inflation, which had sent bond yields higher over the previous months. The 10-year U.S. Treasury note was 2 basis points higher on Friday after gaining nearly a full percentage point since mid-September. Higher inflation makes the fixed income that bonds produce less attractive, and yields rise when bond prices fall.
Companies that produce alcoholic beverages traded sharply lower after the surgeon general called for those products to carry warnings about cancer risks . Shares of Anheuser-Busch InBev, parent company of brands like Budweiser and Corona, closed more than 2% lower, while Diageo, which produces hard liquor brands like Johnnie Walker, Guiness, and Smirnoff, fell nearly 4%.
More: America's surgeon general calls for cancer warnings on alcoholic beverages
And shares of Rivian Automotive, Inc. roared more than 24% higher after the company announced results that beat analysts’ expectations for car deliveries. That announcement followed a Thursday report from competitor Tesla Inc. , which saw its first annual decline in deliveries in 2024.
(This story was updated to add new information.)
This article originally appeared on USA TODAY: Nasdaq leads stocks higher, but beverage makers fall on cancer warning
