(MENAFN- AFP) US stocks went from famine to feast this week, starting out fearful of crashing oil prices and finishing it smiling at a "Santa Claus rally."
The turnaround came Wednesday, the first of three buoyant sessions that by week's end left the S&P 500 in positive territory for December.
"This week was remarkable as far as the velocity of the market's move," said Michael James, managing director of equity trading at Wedbush Securities.
The Dow Jones Industrial Average shot up 523.97 points (3.03 percent) to 17,804.80.
The broad-based S&P 500 jumped 68.32 (3.41 percent) to 2,070.65, while the tech-rich Nasdaq Composite Index gained 111.78 (2.40 percent) at 4,765.38.
The week opened with the same grim sentiment that led to last week's global equity rout. Adding to worries about tumbling oil prices was anxiety over the crashing Russian ruble, which has lost nearly half its value in 2014 compared with the dollar.
The drop in the ruble "is messing with the US stock market's typically festive holiday spirit as it is evoking concerns about the potential for default risk, financial risk, and economic risk," Briefing.com analyst Patrick O'Hare said Tuesday.
- Fed to the rescue -
However, markets began reversing course Wednesday morning in anticipation of a Federal Reserve policy announcement later in the day.
Following a two-day meeting, the US central bank left in place market expectations that it may raise interest rates only in the middle of 2015 and not sooner and gave a fairly upbeat assessment of the economy.
Fed Chair Janet Yellen offered reassurances that sharply lower oil prices are a net-positive for the economy and that economic fallout from struggling Russia is likely to be limited.
US stocks rose significantly after the Fed's announcement and stormed higher again Thursday, with the Dow jumping more than 400 points. The gains were smaller Friday, but the S&P 500 still finished the week within shouting distance of a record.
"The Fed basically said what the market wanted to hear, that is, they're not going to raise interest rates before what the market was expecting, which is some time from the midpoint of next year, so that was encouraging," said Tom Cahill, portfolio strategist at Ventura Wealth Management
James said the market's response to low oil prices and the crashing ruble was comparable to its reaction to other worries this year, such as the Ukraine crisis and anxiety over tech sector valuations.
"We've seen these types of dislocations several times over the last two years," he said. "Every time it's been proven in hindsight that weakness is to be bought and the market continues to be in an upward trend."
Among corporate news stories, Oracle surged after reporting second-quarter earnings that translated into 69 cents per share, a cent above analyst expectations. The information-technology giant cited strong subscriptions for cloud services.
Cruise companies like Carnival Cruise and Royal Caribbean Cruises scored on the historic rapprochement between the US and Cuba as the US launched measures to ease a five-decade US trade embargo.
But some iconic US companies said their results would be dragged down by the lofty dollar.
Coca-Cola projected a seven percent headwind from the strong dollar in the fourth quarter and a 5.0-6.0 percent drag due to currency effects in 2015. Nike also cited currency effects as its forecast of future product orders disappointed markets.
Next week's calendar is expected to be quiet for corporate news. Economic reports include the third and final estimate of third-quarter gross domestic product and existing-home sales and durable goods orders, both for November.
Markets close early on Wednesday and will be shuttered Thursday for the Christmas holiday.
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