US stocks cemented their biggest weekly gain in more than three months and Treasuries rallied following a patch of soft economic data, all against a backdrop of hopes of progress in US-China trade negotiations.

Wall Street’s S&P 500 resumed its rally, up 0.5 per cent, after a slip on Thursday interrupted a three-day winning streak. The benchmark was up 2.9 per cent this week, its biggest weekly advance since late November.

The S&P has registered a weekly decline just twice this year, as trade optimism and the Federal Reserve’s pledge to be patient on rate rises have lifted sentiment on Wall Street.

“Next week’s FOMC meeting and a potentially pending resolution to trade frictions between the U.S. and China are likely the macro drivers to watch going forward,” Anthony Saglimbene, global market strategist at Ameriprise, wrote to clients.

US Treasuries also rallied on Friday, dragging yields lower, following a batch of soft economic data, including industrial production that missed expectations and a gauge of manufacturing activity in New York falling to a 22-month low. Yields on the 2- and 10-year Treasury hit their lowest since early January.

Partly hobbled by a resurgent British pound, the US dollar shed about ¾ of 1 per cent this week for its biggest weekly drop since the first week of December.

Chinese state media on Friday reported “substantive progress” on trade talks and Beijing passed a new foreign investment law designed to smooth the way to a new trade deal with the US.

The CSI 300 index tracking Shanghai and Shenzhen stocks closed up 1.3 per cent.

There were solid moves in Europe. Frankfurt’s Xetra Dax 30 gained 0.9 per cent, gathering pace as the session developed and reaching its highest level since October. London’s FTSE 100 was up 0.6 per cent.

The three day run higher in S&P and Nasdaq is over

Some losers today:

S&P and Nasdaq up 0.69%.

Major indices give back gains into the close.

Boeing share had the higherst daily volume since July 2013 and are ending down -6.15% and had the biggest two day decline since July 2009.

US stocks bounced back from their biggest weekly drop in three months with their largest one-day gain since January as a burst of merger activity and speculation propped up the market.

The S&P 500 and Nasdaq Composite, finishing up 1.5 per cent and 2 per cent, respectively, both had their largest advances since January 30, prompting a mild retreat for US Treasuries.

Propping up tech stocks was Nvidia agreeing on Monday to buy Israeli chipmaker Mellanox Technologies for $6.9bn. That helped trigger a rally in rival semiconductor companies, which countered some of the pessimism from late last week after Japan’s Renesas warned on slowing demand in China.

After starting in the red, the Dow Jones Industrial Average ended 0.8 per cent higher. The blue-chip Dow’s early stumble was due to a sharp drop in Boeing shares, after one of the company’s 737 Max 8 jets operated by Ethiopian Airlines crashed on Sunday. Boeing finished 5.3 per cent lower.

The gains for the broader market follow five straight days of decline for the S&P 500 that were capped last Friday by a disappointing US jobs report. With investors in a more upbeat mood today, government bonds sold off, pushing yields higher. The yield on the benchmark 10-year US Treasury was up 1.6 basis points to 2.6411 per cent.

On the other side of the Atlantic, European banks bounced higher on speculation of a merger between German lenders Deutsche Bank and Commerzbank. That helped lift the broad Stoxx 600 off last week’s 12-session closing low.

The pound recovered from a three-week low as investors continued to watch the UK’s fraught Brexit politics. Sterling’s ability to hold the $1.30 level remained associated with a managed departure from the EU. In afternoon trade, it added 0.9 per cent over the session to $1.3139, having been as low as $1.2949 in early trade.

The strong pound weighed on the dollar, with the DXY index, which tracks the buck against a basket of global currencies including sterling, down 0.1 per cent at 97.176.

1. Price to Sales 2. Price to Book 3. Enterprise Value to Sales 4. Enterprise Value to EBITDA 5. Price to Earnings 6. Enterprise Value to Free Cash Flow

Modestly lower for the major stock indices.

S&P and Nasdaq near the middle of the range

Nasday up for the 10th week in a row