Dow cashes in on Black Friday

LONDON (CNNMoney.com) -- Stocks rallied in light trading Friday, with the Dow closing up more than 180 points, as investors sought deals in the battered financial sector and retailers got a bounce out of Black Friday shopping.

The blue-chip Dow Jones industrial average rose 1.4 percent, while the broader S&P 500 index jumped 1.7 percent. The tech-heavy Nasdaq composite added 1.3 percent.

For the week, the Dow and Nasdaq each lost about 1.5 percent, while the S&P declined 1.2 percent.

Next week brings a packed schedule of economic news. Consumer confidence comes in on Tuesday, existing home sales Wednesday, new home sales and a preliminary reading on gross domestic product Thursday, and personal income and spending Friday.

On Friday, throngs of shoppers descended on stores nationwide in what's become known as Black Friday, one of the most important shopping days of the year for the retail sector as it's when many stores actually begin to make a profit for the year.

The enthusiasm from shoppers helped investors shelve worries - at least temporarily - about the strength of consumer spending, which fuels about two-thirds of the economy.

The rebound on Wall Street comes after a recent slump. Stocks sank Wednesday, sending the Dow to its lowest level in seven months, as worries about an economic slowdown weighed on investors.

But the Thanksgiving interlude helped investors shake some of those concerns.

Stocks on the move included E*Trade (Charts), which surged 25 percent on speculation that it could be taken over.

A number of retail stocks - including Wal-Mart (Charts, Fortune 500), Target (Charts, Fortune 500) and Best Buy (Charts, Fortune 500) - rallied. The biggest gainer in the sector was Circuit City (Charts, Fortune 500), which soared 19 percent.

Battered financial shares gained across the board. J.P. Morgan Chase & Co. (Charts, Fortune 500) and Morgan Stanley (Charts, Fortune 500) each added about 3 percent, while Lehman Brothers (Charts, Fortune 500) jumped over 5 percent.

Drugmaker GlaxoSmithKline (Charts) gained more than 6 percent on news that its rotavirus drug Rotarix guards against the five most common types of the virus. Rotavirus causes diarrhea in infants.

Boeing (Charts, Fortune 500) added more than 2 percent after KLM Royal Dutch Airlines placed an aircraft order with the company worth about $716 million.

Among tech stocks, Barry Diller's IAC/InterActiveCorp. (Charts, Fortune 500) fell about 1 percent. Diller said the company plans to invest $100 million to expand its services in China.

Oil prices turned higher after retreating from the $100-a-barrel mark in the morning. U.S. light, sweet crude for December delivery rose 99 cents to $98.28 a barrel on the New York Mercantile Exchange.

The dollar kept up its slide while gold prices soared. The greenback hit a 2-1/2 year low against the Japanese yen and touched another record low versus the euro.

Market breadth was positive. On the New York Stock Exchange, advancers beat decliners 5 to 1 on volume of 670 million shares. On the Nasdaq, gainers topped losers by a margin of 3 to 1 as 823 million shares changed hands.

In global trade, European markets bounced higher, boosted by deals. Asian markets also mostly rose. Japanese markets were closed for a holiday.