NEW YORK, Dec 21, 2024 (BSS/AFP) - Wall Street stocks rose Friday as US Treasury yields retreated and markets monitored Capitol Hill budget negotiations that aimed to avert a US government shutdown.

Friday's gains reduced the weekly losses following a big drop after Wednesday's Federal Reserve meeting.

US inflation data showed an uptick in November, but the reading came in lower than expected. That prompted a pullback in bond yields that had risen after Fed policy makers signaled they expect fewer interest rate cuts in 2025.

The broad-based S&P 500 finished at 5,930.85, up 1.1 percent for the day but down about two percent for the week.

The Dow Jones Industrial Average gained 1.2 percent to 42,840.26, while the tech-rich Nasdaq Composite Index climbed 1.0 percent to 19,572.60.

"We have seen a nice rebound from what was, in our view, an overreaction to the Fed's outlook on Wednesday," said Angelo Kourkafas of Edward Jones, pointing to Friday's inflation data as a supportive factor for equities.

But markets were also monitoring lawmakers in Washington after interventions by US President-elect Donald Trump and his billionaire ally Elon Musk earlier in the week sabotaged a bipartisan agreement that would have avoided a government shutdown.

Among individual companies, Nike dipped 0.2 percent as it reported lower earnings while new CEO Elliott Hill outlined steps to get the slumping sports giant back on track. Analysts pointed to Nike's near-term outlook, which suggests a turnaround will not be quick.

Carnival jumped 6.4 percent following an upbeat 2025 forecast that included a 20 percent rise in profits to $2.3 billion.