U.S. stock ETFs reversed a two-week slide in the holiday-shortened week with a relief rally in European markets and hopes a fiscal-cliff deal will be reached helping to buoy equities.
The S&P 500 jumped 3.6% during Thanksgiving week, while the Dow added 3.4% and the Nasdaq Composite surged 4%.
As expected, volume was thin with many traders taking the week off. Volume in SPDR S&P 500 (NYSEArca: SPY) was under 50 million shares during Friday’s shortened session, less than half the daily average of 130 million shares the past three months.
The S&P 500 ETF posted its best weekly rally since June as U.S. consumers flooded malls and retailers on Black Friday to kick off the holiday shopping season.
“People are trying to get a sense of what the holiday shopping season will be in the U.S.,” said James Dunigan at PNC Wealth Management in a Bloomberg report. “Other than that, there’s not much driving the market today in this shortened session. Obviously, we’ll all be waiting for the fiscal cliff negotiations when Congress comes back next week.”
European ETFs enjoyed a monster rally this week on hopes leaders are close to an agreement to provide more bailout aid for Greece. Global X FTSE Greece 20 ETF (NYSEArca: GREK) vaulted 10% this week.
In currency ETFs, the euro climbed to a three-week high against the dollar on Friday, Reuters reported. An unexpected rise in German business confidence helped stoke the euro.