Stocks went into rally mode Friday, following a stronger-than-expected report on the nation's manufacturing sector.
After starting the day barely changed, the Dow Jones industrial average (INDU) gained 115 points, or 0.9%, after the manufacturing data was released. 3M (MMM, Fortune 500), Alcoa (AA, Fortune 500) and Caterpillar (CAT, Fortune 500) were the biggest gainers on the blue chip index.
The S&P 500 (SPX) added 10 points, or 0.8%; and the Nasdaq composite (COMP) gained 22 points, or 0.8%.
The Institute of Supply Management's manufacturing index jumped to 55.3 in June -- well above the 51.1 that economists had expected.
"Investors thought the economy would continue to be fairly weak through the summer, but the Chicago PMI number yesterday and the national manufacturing data this morning caused a huge swing in investor sentiment," said Michael Sheldon, chief market strategist at RDM Financial Group.
A strong manufacturing sector will help drive economic growth and corporate profits, he added.
Volume is expected to be light as many market participants head out for the holiday weekend. U.S. markets are closed Monday in observance of Independence Day.
Market outlook: More turbulence ahead
Stocks ended the first half of the year solidly higher Thursday, following a turbulent six months. Regional manufacturing data helped fuel Thursday's rally.
Economy: The University of Michigan consumer sentiment survey for June fell to a reading of 71.5, slightly below the initial reading of 71.8.
Construction spending fell 0.6% in May, after rising 0.4% the prior month. Economist were expecting spending to hold steady in May.
Companies: University of Phoenix operator Apollo Group Inc. (APOL, Fortune 500) was the best performing stock on the S&P 500 and Nasdaq. Shares of the education company jumped more than 7%, after it reported better-than-expected third-quarter earnings late Thursday.
Major auto makers including General Motors (GM, Fortune 500), Toyota (TM) and Ford (F, Fortune 500) are scheduled to report their May sales figures starting around 11 a.m. ET. Shares of Ford were up 0.3% in morning trading.
Meanwhile, shares of Eastman Kodak (EK, Fortune 500) slid 14%, a day after the company received a mixed ruling on the company's patent infringement suit against Apple (AAPL, Fortune 500) and Research in Motion (RIMM).
Cablevision (CVC, Fortune 500) spun off AMC Networks (AMCX), known for popular hits like Mad Men. AMC started trading on the Nasdaq Friday under the ticker "AMCX." Shares fell 8% on the news. Cablevision shareholders are getting one share of AMC Networks for every four shares of Cablevision.
World markets: European stocks were mostly higher in afternoon trading. Britain's FTSE 100 rose 0.3%, the DAX in Germany rose 0.1% and France's CAC 40 was flat.
Asian markets ended the session mixed. The Shanghai Composite ticked down 0.1%, while the Hang Seng in Hong Kong soared 1.5% and Japan's Nikkei added 0.5%.
Currencies and commodities: The dollar rose against the euro, the Japanese yen and the British pound.
Don't fear the commodities bear
Oil for August delivery slipped $1.02 to $94.40 a barrel.
Gas prices snapped a 27-day streak of declines Friday. The price of regular unleaded gasoline increased nine tenths of a cent to $3.550 a gallon, according to motorist group AAA.
Gold futures for August delivery fell $17.40 to $1,485.40 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury edged higher, pushing the yield down to 3.14% from 3.16% late Thursday
