The S&P 500 closed at a record of 2,096.99, with the energy sector up 1.95 percent to lead six sectors higher and utilities the greatest decliner. The Dow Jones industrial average closed up at 18,019.35, the first time since Dec. 26 that the index closed above 18,000. The Nasdaq closed up at 4,893.84, its highest level since March 2000, the peak of the dotcom bubble. The Russell 2000 also closed at a record high.
Crude oil futures settled up $1.57, or 3.10 percent, at $52.78 a barrel on Friday, while Brent oil traded above $61 a barrel, the first three consecutive weeks of gains since last spring.
"I have not been this bullish in a long, long time," said technical analyst J.C. Parets of Eagle Bay Capital. "I still like stocks here. Also we got bearish bonds over the last couple of weeks. So as money continues to come out of that space with interest rates getting a nice bounce, the money will flow towards equities. There is a lot here that suggests we're going a lot higher."
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The U.S. 10-year Treasury yield ticked higher to 2.04 percent on Friday, up nearly 40 basis points in the last two weeks.
The gains reinforce the "perception that the economy is in pretty good shape," said Art Hogan, chief market analyst at Wunderlich Securities.
Like other analysts, Hogan said the few lackluster data points in the past week's reports do not undercut the fact that "on balance, the U.S. economy is moving in a positive direction."
For example, he said that while the small business optimism index last Tuesday missed expectations, the 97 level is still the highest in three years.
"Recent data, especially the strong January employment report, further support PNC's baseline forecast for an initial increase in the Federal funds rate at the Federal Open Market Committee's July 2015 meeting," Stuart Hoffman, chief economist at PNC, said in a report on Friday. "Faster wage growth has been the missing piece of the labor market puzzle, but the January increase in average hourly earnings may indicate that the acceleration is finally arriving."
An expected cease-fire between Russia and Ukraine on Sunday, a resolution in the Greece-euro zone standoff as early as Monday and stabilization in oil prices should form a solid foundation that stocks can move higher as a slew of U.S. economic data and minutes from the Federal Reserve's January meeting come out.
Greek Prime Minister Alexis Tsipras agreed to meet with representatives from the European Union, the European Central Bank and the International Monetary Fund ahead of Monday's key Eurogroup meeting on debt talks, according to Reuters.
The European Central Bank also holds a non-monetary policy meeting in Frankfurt next Wednesday.
While most strategists believe Greece will strike a deal to remain in the euro zone, Jack Ablin, chief investment officer at BMO Private Bank, said that a "Grexit" would be beneficial.
"I think the world is waiting for Greece to leave so Europe can put these problems behind them," he said.
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Important U.S. data points to watch next week include industrial production on Wednesday and the PMI Manufacturing Index flash on Thursday. Notable companies reporting earnings include Wal-Mart and DirecTV on Thursday, and energy firms Marathon Oil, Noble Energy and Cabot Oil & Gas. Gold producer Newmont Mining will report on Thursday.
U.S. markets will be closed on Monday for Presidents Day, and Chinese markets will be closed from Wednesday until the following Tuesday for the Lunar New Year.
On tap next week:
U.S. markets closed for Presidents Day
Earnings: Medtronic, Genuine Parts, MGMResorts, Waste Management, Agilent, Analog Devices, CF Industries, DevonEnergy, Jack in the Box, La-Z-Boy
8:30 a.m.: Empire State Manufacturing Survey
10:00 a.m.: Housing Market Index
10:00 a.m.: E-commerce Retail Sales
12:45 a.m.: Fed's Plosser speaks
2:00 p.m.: Treasury International Capital
Earnings: Actavis, Duke Energy, Garmin, Hyatt, Yandex, Fidelity National Financial, Fluor, Marathon Oil, Marriott
7:00 a.m.: Mortgage Applications
8:30 a.m.: Housing Starts
8:30 a.m.: PPI
9:15 a.m.: Industrial Production
2:00 p.m.: Fed Minutes
Lunar New Year
Earnings: Priceline, Wal-Mart, DirecTV, Discovery Comm., Goldcorp, Hormel Foods, Noble Energy, Con Edison, Intuit, Marvel Tech., Newmont Mining, Nordstrom
8:30 a.m.: Jobless Claims
9:45 a.m.: PMI Manufacturing Index Flash
10:00 a.m.: Philadelphia Fed Survey
10:00 a.m.: Leading indicators
10:30 a.m.: Natural gas inventories
11:00 a.m.: Oil inventories
4:30 p.m.: Fed Balance Sheet/Money Supply
Earnings: Cabot Oil & Gas, Deere
10:00 a.m.: Atlanta Fed Business Inflation Expectations