Stocks rallied back after paring gains in quiet trading before the Memorial Day holiday following mixed economic news on consumer sentiment and home sales.
The Dow Jones Industrial Average rose more than 60 points after ending modestly higherin a choppy session on Thursday.
Most Dow components gained, with JPMorgan and Bank of America among those leading the pack.
TheS&P 500 and the Nasdaq also rose. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 16.
Most key S&P 500 sectors gained, led by materials, financials and energy.
The modest bounce higher in stocks today, and over the last few days, reflects the fact the market "got surprisingly oversold very quickly," said Doug Godine, head of institutional sales and trading at Signal Hill Capital. "We're just starting to see a snapback rally off those low numbers."
Going forward, Godine remains cautiously optimistic. "For every economic data point or earnings data point I feel like you are getting two good for one bad, and I’ll take that right now," he said.
As long as corporate balance sheet remain strong, and continue to demonstrate earnings growth, which he thinks they will, "that will be enough to keep this dribble of money off the sidelines and coming into equities," Godine added. "We haven’t hit the tipping point where it becomes a flood. But it's a very solid position for the equity markets to be in."
Still, while May was a bad month for stocks, June may be worse, if you consider history, according to Dan Greenhaus, chief economic strategist at Miller Tabak. "Dating back to the secular bear market’s beginning, June has been flat or down 73 percent of the time," Greenhaus wrote in a note to clients.