Wall Street ended higher on Friday as investors assessed U.S. President Donald Trump’s latest remarks on China, while quarterly results from regional banks eased concerns about credit risks. The TSX ended sharply lower, however, as traders took profits in the gold sector.
Trump said his proposed 100% 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 November 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 selloff 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% after the bank reported higher third-quarter profit. Fifth Third Bancorp rose 1.3%, Zions shares rebounded from losses the day before to close 5.8% higher, and Western Alliance advanced 3.1%.
The S&P Composite 1500 Regional Banks index climbed 1.8% after tumbling almost 6% the day before.
The S&P 500 financial sector index, which includes the largest U.S. banks, rose 0.8%.
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% in the third quarter, an improvement from expectations of 8.8% at the start of October, according to LSEG I/B/E/S.
Following a nearly 14% gain in 2025, the S&P 500 is valued at 23 times expected earnings, its priciest level in five years.
The Dow Jones Industrial Average rose 282.75 points, or 0.61%, to 46,233.57, the S&P 500 rose 36.72 points, or 0.55%, to 6,665.82 and the Nasdaq Composite rose 128.82 points, or 0.57%, to 22,690.59.
For the week, the S&P 500 gained 1.7%, the Nasdaq rose 2.1% and the Dow climbed 1.6%.
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%, Apple adding almost 2% and Amazon falling 0.7%. Eli Lilly fell 2% after Trump said he would bring down prices of weight-loss drugs. State Street dropped 1.4% after the bank’s third-quarter net interest income missed estimates.
The S&P/TSX Composite Index closed at 30,108.48, down 350.32 points or 1.15%. Performance was overall mixed, with materials by far the biggest decliner, dropping nearly 6%.
Gold prices fell more than 2% on Friday after hitting a record high above US$4,300 per ounce, pressured by a firmer dollar and Trump’s comment that a “full-scale” tariff on China would be unsustainable. Traders took the opportunity to take profits in the high-flying gold miners sector.
Earlier in the session, gold had temporarily been on track for its biggest weekly gain since September 2008 when the collapse of Lehman Brothers fueled the global financial crisis.
“I think Trump’s more conciliatory tone since the initial announcement of 100% tariffs has taken a little heat out of the precious trade,” said Tai Wong, an independent metals trader.
Financials, which lost close to 2% on Thursday amid U.S. credit market jitters, fell a modest 0.2% in Toronto Friday.
Bond yields edged back up on Friday following their tumble the day before. The yield on benchmark U.S. 10-year notes rose 2.3 basis points to 3.999%, from 3.976% late on Thursday.
Reuters, Globe staff