The Dow Jones Industrial Average's increase, which had stretched to as many as 837 points early Friday, narrowed to a final gain of over 477 points, or 1.9 percent, while the S&P 500 and the Nasdaq Composite were up 1.31 percent and 1 percent, respectively.
The Dow rebounded from its fourth-worst one day point drop of 1,861 points on Thursday but despite Friday's overall gains, the three major averages closed lower for the week.
Allianz chief economic adviser Mohamed El-Erian told FOX Business that equity markets would remain "really bumpy" and that investors "should be ready for a continued roller coaster."
In a new report released Friday, the central bank said individuals and groups across the country were concerned that jobs lost in some of the hardest-hit sectors of the economy will be slow to return and that some may never do so.
The major averages also got a boost Friday after former Chinese finance minister and Cabinet adviser Zhu Guangyao said on Thursday evening that relations between the U.S. and China were “far from satisfactory” and that the two countries should “waste no time” improving them, according to the Associated Press.
“Objectively speaking, the epidemic has had an impact on the implementation of this agreement, but in this kind of situation, China emphasizes that we should work hard together to ensure the implementation of the Phase 1 agreement," he said.
Tensions between the two countries have flared after President Trump criticized Beijing for its initial response to the COVID-19 outbreak, which was first reported in Wuhan but has since spread around the globe.
Zhu’s comments came just hours after all three of the major averages suffered their steepest one-day slide since March 16. On Thursday, all three fell at least 5.27 percent after signs of a resurgence in COVID-19 cases and a warning from the Federal Reserve that the economy's recovery would be slow.
Looking at stocks, airlines, cruise operators, hotels and other travel-related names were sharply higher after bearing the brunt of the selling on Thursday. American Airlines said second-quarter revenue will be down 90 percent year-over-year amid a 75 percent drop in total-system capacity.
Boeing supplier Spirit Aerosystems was asked to delay resumption of aircraft-part manufacturing to avoid fueling a glut while carriers recalibrate in the wake of the COVID-19 pandemic, The Wall Street Journal reported during the final hour of trading on Thursday.
Elsewhere, Tesla received a downgrade to “underweight” at Morgan Stanley due to concerns the electric-vehicle maker isn’t as in as strong a position as before the pandemic. Analyst Adam Jonas pointed to a deterioration in U.S.-China relations, weaker China demand, price cuts and production challenges as reasons for the downgrade.
Rental car company Hertz wants to sell up to $1 billion of stock as its share price has soared despite the possibility a bankruptcy filing could make the stock worthless.
On the earnings front, fitness-wear maker Lululemon reported net revenue sank 17 percent from a year ago as the company shuttered its U.S. and European stores amid the COVID-19 pandemic. Lululemon has reopened 60 percent of its locations and plans to have the rest back in operation by the end of June.
West Texas Intermediate crude oil ended the week 8.32 percent lower at $36.26 per barrel, while gold posted modest weekly gains closing at $1,729.30 an ounce.
U.S. Treasurys were under modest pressure, causing the yield on the 10-year note to settle at 0.698 percent.
In Europe, markets were mixed, with France’s CAC and Britain’s FTSE clinging to gains of less than 0.1 percent while Germany’s DAX dropped 0.59 percent.
Markets were lower across Asia, with Japan’s Nikkei down 0.75 percent, Hong Kong’s Hang Seng weaker by 0.73 percent and China’s Shanghai Composite slipping 0.04 percent.