Wall Street rebounds, erases week's losses with Russia news
The S&P and Dow both posted their best day since March today, with the market buoyed by news that Russia was ending military drills near the Ukrainian border, while investors overlooked US air strikes in Iraq.
The gains helped major averages erase the week's losses as buying intensified as the day came to a close. The CBOE market volatility index fell 5.7 percent to 15.71 in a sign of reduced investor uncertainty.
Stocks have been under pressure of late as investors, worried about high valuations and uncertainty around the world, pulled back from riskier assets. Before Friday's rally, the S&P 500 had given up more than 4 percent while the small-cap Russell was down 7 percent over the past four weeks.
Markets rallied after Russia's Defense Ministry said it had finished military exercises in southern Russia, which the United States had criticized as a provocative step amid the Ukraine crisis.
The Dow Jones industrial average rose 182.52 points, or 1.12 percent, to 16,550.79. The S&P 500 ended up 21.84 points, or 1.14 percent, to 1,931.41. The Nasdaq Composite added 36.02 points, or 0.83 percent, to 4,370.99.
For the week, the Dow rose 0.4 percent, the S&P 500 gained 0.3 percent, and the Nasdaq rose 0.4 percent.
Utilities were the day's biggest gainer among S&P sectors, rising 2 percent, followed by a 1.7 percent increase in energy shares.
Shares of defense companies also performed well, with Lockheed Martin Corp ending the day up 1.8 percent to $165.80, Raytheon Co up 2.4 percent to $91.61 and Northrop Grumman Corp up 2.1 percent to $122.86.
US traded shares of Tekmira Pharmaceuticals Corp surged 45.1 percent to $20.70 after the US Food and Drug Administration cleared the company's experimental Ebola treatment for potential use in humans. More than 28.4 million shares changed hands, the busiest day of trading in company history.
About 5.5 billion shares traded on all US platforms, according to BATS exchange data, compared with the five-day average of 6.5 billion.
European shares fell for the seventh time in eight sessions, on growing nervousness over Iraq.
The FTSEurofirst 300 index of top European shares ended down 0.7 percent at 1,305.75 points, its lowest close since March 24.
Meanwhile, Japan's Nikkei share average slumped to a two-month low suffering its biggest daily decline in five months as investors were gripped with fear that geopolitical crises in Ukraine and the Middle East could disrupt global growth.
The Nikkei average fell 3.0 percent, its largest daily loss in five months, to 14,778.37. It has fallen 6.2 percent from a six-month high of 15,759.66 hit just over a week ago.