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Alphabet shares jump

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Lilly becomes first drugmaker to join trillion-dollar club

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Report: US considering letting Nvidia ( NVDA ) sell H200 chips to

China

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Indexes: Dow up 1.1%, S&P 500 up 1%, Nasdaq up 0.9%

By Caroline Valetkevitch

NEW YORK, Nov 21 (Reuters) - U.S. stocks rallied on

Friday as investors increased bets that the Federal Reserve will

cut interest rates next month, while all three of the major

indexes posted losses for the week amid concerns over lofty

technology valuations.

The Nasdaq fell for a third straight week in its longest run

of weekly losses since March. The index is now down 7% from its

October high.

During the session, shares of Nvidia ( NVDA ) briefly jumped

after sources familiar with the matter said the Trump

administration is considering green-lighting sales of the

company's H200 artificial intelligence chips to China. The stock

ended down 1%, still well off of its lows of the session.

Nvidia ( NVDA ) is down 5.9% for the week even though the AI leader

late on Wednesday reported strong quarterly results and gave a

robust forecast.

New York Fed President John Williams, a voting member of the

Federal Open Market Committee, said the central bank can still

cut rates "in the near term" without putting its inflation goal

at risk. That boosted market views for a rate cut at the Fed's

December meeting, even as other policymakers insisted that

borrowing costs should remain steady for now.

Markets are now pricing in a nearly 72% chance of a rate cut

from the central bank at its December meeting, according to the

CME's FedWatch Tool, up from 39.1% in the prior session.

"The big tailwind today is that shift in rate cut odds for

the December Fed meeting," said Ross Mayfield, investment

strategist at Baird in Louisville, Kentucky.

All 11 of the S&P 500 sectors ended higher.

The Dow Jones Industrial Average rose 493.15 points,

or 1.08%, to 46,245.41, the S&P 500 gained 64.23 points,

or 0.98%, to 6,602.99 and the Nasdaq Composite gained

195.04 points, or 0.88%, to 22,273.08.

For the week, the Dow was down 1.9%, the S&P 500 was down

about 2% and the Nasdaq was down 2.7%. Also, the small-cap

Russell 2000 index fell for a fourth straight week in its

longest run of weekly losses since March.

Stocks have been especially volatile in the past two

sessions, reflecting heightened investor anxiety over high

valuations in the technology sector, ambitious AI spending plans

and concerns about what might happen at the December Fed

meeting.

Also on Friday, Boston Fed President Susan Collins said on

CNBC that policy was "in the right place," indicating skepticism

about the need for another rate cut.

Global brokerages are split over whether the Fed will cut

interest rates in December or hold them.

Data on Thursday showed the unemployment rate increased in

September even as employers added more jobs than economists had

expected during the month. The report was delayed because of the

long government shutdown.

Eli Lilly ( LLY ) shares ended 1.6% higher after the company

during the session became the first drugmaker to touch the $1

trillion level of market capitalization.

Among the day's biggest boosts, Alphabet shares

closed up 3.5% on Friday, while Apple ( AAPL ) was up 2% and

Meta Platforms ( META ) was up 0.9%.

Advancing issues outnumbered decliners by a 3.1-to-1 ratio

on the NYSE. There were 68 new highs and 213 new lows on the

NYSE.

On the Nasdaq, 3,499 stocks rose and 1,274 fell as advancing

issues outnumbered decliners by a 2.75-to-1 ratio.

Volume on U.S. exchanges was 21.06 billion shares, compared

with the 20.03 billion average for the full session over the

last 20 trading days.