U.S. stocks closed higher Friday, following a weaker-than-expected jobs report, finishing off the best week of the year for both the S&P 500 and the Dow Jones industrial average. Why is that? The markets could be entering a period in which bad economic news is good for stock markets.
The hope is that data show a decelerating economy will force the Fed to cut interest rates. Lower interest rates are seen as good for stock prices, because they hold down bond yields, making equities a relatively more attractive investment.
For the week, the Dow gained 4.7 percent, the S&P 500 returned 4.4 percent, while the Nasdaq climbed 3.9 percent. The Dow and S&P 500 had their best weekly showing since late November, while it was the Nasdaq’s best performance since the week ended December 28.
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