NEW YORK — Wall Street ended its calmest week in a month with a big advance Friday, rising on solid economic readings that countered the bleak sentiment that has blanketed the financial markets. The Dow Jones industrial average rose more than 140 points in a lightly-traded session.
Stocks started out flat but jumped following a stronger-than-expected reading on new homes sales for July. That report followed a reading showing orders to factories for big-ticket goods rose sharply in July.
The stock market's gains Friday after several stable or positive sessions suggested that Federal Reserve policymakers and stock market investors have perhaps struck a truce — maybe only a tenuous one — with the Fed acknowledging it stands ready to try to fend off a calamitous seizing up of the credit markets and investors willing to focus on readings on the health of the economy before making decisions.
"I think we've stabilized a bit since the Fed has lowered the discount rate," said Nicholas Raich, director of equity research at National City Private Client Group in Cleveland, referring to the Fed's decision a week ago to cut the interest it charges to lend directly to banks. "That has calmed the market and eased some fears because we have a Fed that is willing to step in and help out."
According to preliminary calculations, the Dow rose 142.91, or 1.08 percent, to 13,378.79.
Broader stock indicators advanced. The Standard & Poor's 500 index rose 16.86, or 1.15 percent, to 1,479.37. The Nasdaq composite index rose 34.99, or 1.38 percent, to 2,576.69.