Wall Street Rebounds as Treasury Yields Retreat, Fed Rate-Cut Optimism Builds

U.S. stocks climbed firmly into positive territory on Friday, with the Nasdaq up 1.4% to 19,616.63, the S&P 500 up 1.0% to 5,997.23 and the Dow up 0.9% to 43,529.16, as falling Treasury yields and renewed interest-rate optimism lifted sentiment. The benchmark 10-year yield declined for a fourth straight day after hitting its highest close in over a year on Monday, settling near 4.599%. Recent inflation data and comments from Fed Governor Christopher Waller, who told CNBC the central bank could cut rates "multiple times this year" if inflation eases, drove the optimism. December industrial production rose 0.9%, sharply beating the 0.3% consensus. Semiconductor stocks led sector gains, with the Philadelphia Semiconductor Index up 2.4% as Applied Materials (AMAT) rallied on a KeyBanc upgrade to Overweight. Traders also weighed the outlook ahead of President-elect Donald Trump's inauguration on Monday.