Stocks rallied Friday but remained on track for a sharp weekly decline as volatility continued to spread through Wall Street.

The Dow Jones Industrial Average was trading 501 points higher, or 1.2%. The S&P 500 was up 1.6%, and the Nasdaq Composite was up 2.1%.

Nvidia shares jumped more than 4%. Tesla and Meta Platforms rose more than 1% along with Netflix, Amazon and Apple.

Sentiment on Wall Street got a boost Friday as it appeared a government shutdown was averted. Senate Minority Leader Chuck Schumer, D-N.Y., said he would not block a Republican government funding bill.

However, data released Friday from the University of Michigan confirmed that consumer confidence has declined amid uncertainty over ongoing tariffs, concerns that have driven the market lower for the past three weeks. Consumer sentiment fell in March to 57.9, below the 63.2 economists surveyed by Dow Jones had expected.

"Consumer sentiment is deteriorating, inflation expectations are rising, the 10-year Treasury yield is rising. You would think the market would go down. So a lot of people are watching to see if this rally has any legs or legs," said Thomas Martin, portfolio manager at Globalt Investments.

Thursday's 1.4% decline dragged the S&P 500 down 10.1% from its record close last month, officially entering a correction. That's defined as a decline of at least 10% from a recent high. The Dow and the 30-stock Nasdaq fell 1.3% and about 2%, respectively, in the session.

With Thursday's decline, the Nasdaq fell further into correction territory and is now down more than 9% this year. The small-cap Russell 2000 has fallen about 18% from its recent high, meaning it is nearing a bear market, or a 20% decline.

That marked another milestone in a rout that has gripped investors for the past three weeks as President Donald Trump's sometimes-up-and-down tariff policies have fueled market uncertainty and volatility. All three major indexes have fallen more than 4% this week.

The Dow is on track for its second straight losing week and its worst weekly decline since March 2023. It would be the fourth straight negative week for the S&P 500 and Nasdaq.

Investors are bracing for a Federal Reserve policy meeting next week, where Fed fund futures are pricing in a 97% chance that interest rates will be held steady, according to the CME FedWatch tool.

"What we want to see is rates not going up, because that would be an indication that the Fed is losing control. If the Fed says they're going to cut and raise rates, that shows a lack of confidence," Martin added. (Newsmaker23)

Source: CNBC