The US stock market rallied on Friday after days of pain brought on by Trump’s trade war.
Markets cheered after Sen. Chuck Schumer said he’d support a GOP spending bill.
It means a government shutdown will likely be averted, delivering investors much-needed good news.
After days of pain brought on by President Donald Trump’s trade war, markets got some relief in Friday’s session as developments in Washington, DC, indicated the government will avoid a shutdown.
Major stock averages rose sharply on the unexpected news that Senate Minority Leader Chuck Schumer would support the six-month stopgap bill from Republicans. The benchmark S&P 500 increased as much as 2% on Friday, with the biggest gains coming in the afternoon. It helped claw back some of the week’s losses, although the benchmark is still down 2.5% over the past five days.
The Nasdaq jumped as much as 2.5%, while the Dow Jones Industrial Average peaked with a nearly-700-point gain.
Here’s where the market stood around 1:30 a.m. ET Friday:
Though Schumer pledged to oppose the bill earlier in the week, signaling the Democrats would opt for a shutdown, he ultimately conceded that his party would wield no control in such a scenario.
“The total off-ramp of a shutdown, how you stop a shutdown, is totally determined by the Republican House and Senate, and that is totally determined because they’ve shown complete, blind obeisance [to] Trump, DOGE, etc. They could keep us in a shutdown for months and months and months,” he told reporters.
While the move has angered some fellow Democrats who were ready to oppose the spending bill, investors cheered Schumer’s about-face as it removed a layer of uncertainty in what’s been a trying week for markets.
The exuberance was enough for markets to sidestep fresh signs of consumer weakness. Friday’s consumer sentiment report was the lowest reading since 2022, with US consumers facing tariff uncertainty and inflation fears.
A barrage of tariff news this week crushed investor confidence and sent volatility soaring. The S&P 500 ended Thursday’s session in a correction, down 10% from its February 19 high.
At the same time, gold reached a record high of $3,000 an ounce on Friday, while Treasury yields have dropped in an investor flight to safety.
Even with markets in retreat, the Trump White House has remained unfazed. On Thursday, Treasury Secretary Scott Bessent said that the administration isn’t worried about a “little bit of volatility,” and the focus is on the broader economy.
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