NEW YORK/LONDON (March 15): US equities followed European stocks higher on Friday to end a bumpy week on a positive note, although safe-haven gold hit a record high, with investors still showing some signs of anxiety about the economic impact of tariffs.

German government bond yields and the euro rose on Friday, with German Chancellor-in-waiting Friedrich Merz saying he had secured crucial backing from the Greens for a massive increase in state borrowing.

Germany's news helped boost US Treasury yields, according to Garrett Melson, a portfolio strategist at Natixis Investment Managers, who also attributed equity gains on Friday to the S&P 500 confirming it was in a correction on Thursday.

"It's been a sharp decline from the highs in mid-February," said Melson.

"You are seeing some signs of it at least getting an intermediate low, and a little bit of a relief rally," he said. "There's not really anything meaningful in the way of news to really drive a rally other than just the technicals."

On Wall Street, the Dow Jones Industrial Average closed up 674.62 points, or 1.65%, at 41,488.19, while the S&P 500 rose 117.42 points, or 2.13%, to 5,638.94 for its biggest one-day percentage gain since Nov 6, the day after the US election.

The benchmark S&P index had finished Thursday more than 10% below its February record close, after US President Donald Trump threatened to impose a 200% tariff on European wine and spirit imports, the latest trade war escalation after Europe retaliated against US tariffs on steel and aluminium.

Last week, the Nasdaq confirmed it was in a correction, driven lower by tariff and growth uncertainties, as well as high valuations of megacap tech stocks. The Nasdaq Composite ended up 451.07 points, or 2.61% at 17,754.09 on Friday, for its biggest daily gain since Nov 6.

MSCI's broadest gauge of global stocks rose 14.73 points, or 1.79%, to 836.32 on Friday, but still showed its biggest weekly fall since December.

Earlier, the pan-European STOXX 600 index closed up 1.14%.

Spot gold breached US$3,000 (RM13,335) an ounce for the first time in early London trading, before losing ground to last trade down 0.17% to US$2,982.72 an ounce. The precious metal was still up close to 14% year-to-date, as trade wars and growth worries boosted its safe-haven appeal.

In fixed income, the yield on the benchmark German 10-year Bunds was last at 2.876%, after earlier rising as high as 2.936%.

US Treasury yields rose as the stock market recovery reduced safe-haven demand for US government debt.

The yield on benchmark US 10-year notes rose 4.2 basis points to 4.318%, from 4.276% late on Thursday, while the 30-year bond yield rose 2.9 basis points to 4.6248%.

The two-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose seven basis points to 4.023%, from 3.953% late on Thursday.

"What you have had over the past week or two is a repricing of what's called the Trump put lower for equities, while at the same time, understanding that tariffs are probably here to stay in some form and aren't just a negotiating tactic," said Zachary Griffiths, a senior strategist at CreditSights.

In currencies, the euro gained broadly on optimism about Germany. Against the dollar, the euro was up 0.28% at US$1.0882, while against the pound it gained 0.44%, and rose 0.63% against the Swiss franc.

Against the Japanese yen, the dollar strengthened 0.55% to 148.62. Against the Swiss franc, the greenback strengthened 0.33% to 0.885, supported by hopes the US government would avoid a shutdown over the weekend.

Oil prices rebounded 1% to end the week nearly unchanged, as investors weighed the diminishing prospects of a quick end to the Ukraine war that could bring back more Russian energy supplies to Western markets.

Brent crude futures settled 70 cents, or 1%, higher at US$70.58 a barrel, after falling 1.5% in the previous session. US West Texas Intermediate crude closed at US$67.18 a barrel, up 63 cents, or 1%, after losing 1.7% on Thursday.

Earlier in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan had closed up almost 1%, but lost almost 1.5% for the week.

Uploaded by Tham Yek Lee