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Stocks end roller coaster week on higher note

"Inverted yield curve" sparks recession fears

U.S. stocks rose ended a turbulent week Friday, as investors tried to figure out whether President Trump's trade war and slowing economies around the world will drag the United States into a recession.

The S&P 500 rose 1.4%, closing at 2,888. The Dow climbed 1.2%, to 25,886, and the Nasdaq picked up 1.7%, to 7,895. But each index still finished with a third-straight weekly decline.

Friday marked the seventh time in the last 10 days that the S&P 500 swung by at least 1%, something that hasn't happened since the end of 2018, the last time investors were getting worried about a possible recession. At that time, they were concerned about rising interest rates, along with the trade war.

Stocks turned volatile this week because of new worries that the global economy is cooling off, even as the U.S. economy stayed on steady ground. President Donald Trump this week delayed planned tariffs against China until Dec. 15, saying he was doing so in order to prevent price increases for holiday shoppers. 

Carlyle Group's David Rubenstein: "We're due for a recession"

"Market participants have become increasingly worried about the outlook with concerns about a recession at the highest since the recovery started," Bank of America analysts said in a note Friday.

Historically, this level of volatility is not uncommon — and the market is heading into what is its most volatile season.

"We're also heading into a tough season for the market," said Emily Roland, co-chief investment strategist at John Hancock Investment Management. "September and October tend to be the most volatile of the year for markets. We've been talking to investors for that reason to look for areas to prune risk within a portfolio."

The S&P 500 has lost an average of 1.1% in September over the last 20 years, making it the worst-performing month of the year. October's track record is better, but it includes the worst monthly performance in that stretch, a nearly 17% drop in 2008.

Long-term bond yields also climbed Friday. The yield on 10-year Treasury rose to 1.56% from 1.52% late Thursday.

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