Stocks ended near session highs Friday following news that a group of euro zone finance ministers have approved the next round of aid for Greece and amid optimism over the euro zone ahead of the EU summit on Sunday.
The Dow Jones Industrial Average jumped 267.01 points, or 2.31 percent, to finish at 11,808.79, finishing firmly in positive territory for the year.
The S&P 500 rallied 22.86 points, or 1.88 percent, to end at 1,238.25. The Nasdaq gained 38.84 points, or 1.49 percent, to close at 2,637.46. The CBOE Volatility Index, widely considered the best gauge of fear in the market, finished below 32.
For the week, the Dow rose 1.41 percent, the S&P climbed 1.12 percent, while the Nasdaq declined 1.14 percent. Among the Dow components, Travelers was the biggest gainer, while IBM slumped.
Among the key S&P sectors, financials logged the biggest gain, while techs slipped.
European shares closed higher amid optimism that policymakers would make progress on a solution to the euro zone debt crisis in the coming days.
France and Germany said in a joint statement that European leaders would discuss a global solution to the crisis on Sunday, but no decisions would be adopted before a second meeting by Wednesday at the latest.
“[The result from the EU summit] is not going to cure all the ills, but it’s a step toward the right direction…otherwise the market certainly will respond in an extremely negative way,” said Peter Cardillo, chief market economist at Rockwell Global.
Cardillo explained that Sunday’s summit will set the tone for markets until the second meeting on Wednesday when a final decision is expected to be made.