Stocks shuffle on Friday as S&P 500 heads for best week since 2020

US stocks were mixed Friday after a three-day rally for the S&P 500, which set the stock benchmark on pace for its biggest weekly gain in more than a year.

The Dow Jones Industrial Average fell 90 points, or 0.25%. The S&P 500 gained 0.2% and the Nasdaq Composite rose about 1%.

Shares are coming off a massive three-day rally that saw the S&P 500 make its best week since November 2020. The broad market index is up more than 4% this week, while the tech-heavy Nasdaq Composite is up more than 5. % this week and is heading for its best week since February 2021.

Meanwhile, the blue-chip Dow is rising for the fifth day in a row. It is up 4.3% this week and is also on track for its biggest weekly gain since November 2020.

Shares took a breather on Friday as investors continued to digest the news from the Federal Reserve earlier this week, as well as the ongoing war between Russia and Ukraine and a rise in Covid cases in Europe due to an emerging sub-variant.

President Joe Biden spoke with Chinese President Xi Jinping on Friday to discuss Russia’s invasion of Ukraine, and Xi told Biden that the United States and China each have an obligation to promote peace. Russia has made requests for military or economic aid from China, and the call has been seen as a critical test of Biden’s ability to convince China to stay on the sidelines of the conflict.

Investors also rated their own risk appetite. Despite the week’s big gains, they did not come without their share of volatility, which showed no signs of abating in the near term.

“For 2022, volatility will be investors’ story,” Greg Bassuk, CEO of AXS Investments, told Slice Mag. “Normally we would feel much more optimistic around a single factor that has a good ability to level out volatility, but given this unprecedented level of highly significant factors that could somehow drive the markets, we don’t see the volatility normalize in the next few months.”

Shares of FedEx fell more than 5% on Friday after the US delivery company posted a lower-than-expected quarterly profit amid labor shortages, while the pandemic also hurt holiday revenue growth.

GameStop saw its shares fall about 2% after the video game retailer reported an unexpected loss during the holiday quarter. The company said it will launch a new marketplace for non-fungible tokens, or NFTs, at the end of April.

Friday’s moves came as traders continued to process the latest developments in the Ukraine-Russia war.

Several missiles have hit an aircraft repair center on the outskirts of Lviv in western Ukraine. Meanwhile, President Joe Biden is scheduled to meet with Chinese President Xi Jinping to discuss the conflict. A Ukrainian official also said one person was killed in an airstrike that hit Kiev. (Click here for live updates.)

Russia reportedly made a $117 million dollar bond payment Thursday, avoiding a historic foreign currency default. Stocks expanded their gains after the report.

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Traders are also still working on the latest update from the Federal Reserve from earlier this week. The central bank indicated at its remaining six meetings this year that it expects to raise interest rates. The Fed also raised interest rates for the first time since 2018.

On Friday, Fed Governor Christopher Waller told Slice Mag’s “Squawk Box” that the central bank may need to make at least one more rate hike of 50 basis points or more this year to contain “raging” inflation.

“Fortunately, investors’ inflation expectations for the next five years have been brought down quite a bit, which, if sustained, will persist. [to] useful to the Fed and the markets, despite somewhat higher interest rates,” said John Vail, chief global strategist at Nikko Asset Management.