Tech stocks push Wall Street to rebound after two-day plunge

Wall Street climbed more than 1 percent on Friday following its worst two-day slide in eight months, with technology and other high-growth stocks leading a fight back.

Ten of the 11 major S&P sectors were higher, led by the technology sector’s 3.11 percent jump, with Microsoft and Apple gaining 3 percent.

JPMorgan Chase and Wells Fargo reversed earlier gains to tread lower after their quarterly results, while Citigroup was up 1 percent as its profit topped estimates.

The bank results launch a quarterly reporting season that will give the clearest picture yet of the impact on profits from President Trump’s trade war with China.

“The market is going to focus on not just current quarter earnings, but guidance going forward, particularly as it relates to the profit margins. You’ve got some indications of rising wage pressure and higher interest rates,” said Willie Delwiche, investment strategist at Robert W. Baird in Milwaukee.

“The underperformance from banks and financial sector even as rates have moved higher has been a bit of a warning sign for the market overall. If you can get banks starting to trend higher and providing some leadership for the market, then that helps switch some of the fears that are in the market overall.”

Earnings at S&P 500 companies are estimated to have risen 21.3 percent in the third quarter, according to I/B/E/S data from Refinitiv, a slowdown from the previous two quarters.

Wall Street’s two-day slide this week was its worst in eight months, pulling the three major indexes down a little over 5 percent each, with the Nasdaq narrowly avoiding moving into correction territory.

“A bounce off the lows isn’t unexpected, but the key will be what kind of a market support it has and whether or not it can persist,” said Delwiche.

At 10:04 a.m. ET the Dow Jones industrial average was up 347.71 points, or 1.39 percent, at 25,400.54, the S&P 500 was up 46.39 points, or 1.70 percent, at 2,774.76 and the Nasdaq was up 183.33 points, or 2.50 percent, at 7,512.39.

The other major gainers were the consumer discretionary and communication services sectors, which rose 2.73 percent and 2.08 percent, respectively.

The two sectors, along with tech, house the high-growth FAANG group. Facebook, Amazon, Apple, Netflix and Alphabet were higher between Facebook’s 1.3 percent and Netflix’s 5.8 percent.