Investing.com – As G7 finance ministers and central bankers kicked off a meeting in Japan to discuss how to combat sluggish global growth, Wall Street was on track to recover some of the losses caused by jitters over the possibility that the Federal Reserve (Fed) could tighten monetary policy as soon as the June 15 meeting.
At 15:22GMT or 11:22AM ET, the Dow 30 jumped 124 points, or 0.71%, while the S&P 500 gained 17 points, or 0.84%, and the tech-heavy NASDAQ Composite traded up 61 points, or 1.30%.
The increased chance of a rate hike in June rattled global markets on Thursday and pushed the dollar to seven-week highs as traders readjusted their outlook for U.S. monetary policy.
All three major indices were on track for a weekly loss, with Dow and S&P facing what could be the first four week losing streak since October 2014, while the Nasdaq Composite looked set to register a fifth consecutive weekly drop, its first since 1992.
Both New York Fed president William Dudley and Richmond Fed chief Jeffrey Lacker echoed on Thursday the idea in the minutes from the last Fed meeting that June could be appropriate for a rate hike if economic data continued to show strength.
The odds for tightening to begin in June shot up from 4% last week to 30% on Friday, according to Fed fund futures data compiled by CME Group.
Fed governor Daniel Tarullo steered away from commenting on monetary policy or the economy in a speech about insurance company supervision and regulation and plans for capital requirements.
Yet the Canadian finance minister Bill Morneau chimed in on Friday that a willingness from the Fed to increase rates was a sign of a healthy U.S. economy.
In a light calendar day for macro data, April {{ecl- 99||existing home sales}} rose for a second consecutive month to beat consensus.
In company news, Yahoo (NASDAQ:YHOO) fell around 1% on a Wall Street Journal report that bids for the internet portal’s core assets were expected to come in at $2 to $3 billion, lower than originally expected. However, CNBC suggested that the report was in error, citing sources close to the matter as saying that number was lower than offers already received in the first round of bids.
The balance of earnings reported since after the market close on Thursday was largely negative.
Campbell Soup Company (NYSE:CPB) tumbled more than 6% after mixed quarterly results and despite increasing its forecast.
Foot Locker (NYSE:FL) was down by more than 6% after its first quarter comparable sales rose less than expected.
Deere & Company (NYSE:DE) fell more than 5% as its fiscal second quarter net income tumbled and net sales decreased 4%.
Ross Stores (NASDAQ:ROST) gave up more than 3% after giving a second quarter guidance that missed consensus.
In a notable exception to the losses, Applied Materials (NASDAQ:AMAT) soared close to 13% after reporting fiscal second quarter results and giving a better than expected guidance.
Gap Inc (NYSE:GPS) also rose more than 3% after reporting earnings and announcing that it would close 75 Old Navy and Banana Republic stores.
Although oil prices slipped on Friday, they were still on track for weekly gains of 5% as supply disruptions from turmoil in Nigeria, the lowest output in the U.S. since September 2014, the continuing saga of wildfires in Canadian oil sands and the crisis in Venezuela led to hopes of a reduction in brimming inventories.
Market participants looked ahead to the U.S. oil rig count from oilfield services provider Baker Hughes. Last Friday, the data showed an eighth straight week of declines in the number of rigs drilling for oil in the U.S.
U.S. crude futures dropped 0.04% to $48.65 a barrel by 17:26GMT, or 11:26AM ET, while Brent oil slipped 0.12% to $48.75.
The resurgent dollar, buoyed by a more hawkish Fed, was hovering at a seven-week high on Friday, which also weighed on investor sentiment in commodities, as they become more expensive to buyers using other currencies.
Gold continued to slip on Friday heading for a third straight week of losses, its longest stretch since last November. Gold is sensitive to moves in U.S. rates, as a rise would lift the opportunity cost of holding non-yielding assets such as bullion.