The stock market picked itself up after a mid-week tumble and closed strong Friday on a government report of low inflation.
The Dow Jones index of 30 industrials climbed 22.55 to 1,990.55, cutting its loss for the week to 16.91 points.
Advancing issues outnumbered declines by more than 2 to 1 in nationwide trading of New York Stock Exchange-listed stocks.
NYSE volume came to 147.24 million shares, against 143.88 million in the previous session.
The market opened stronger on the government's report that inflation in wholesale prices slowed to a rise of just 0.4% in April from 0.6% in March.
The news also helped bonds rally, allowing yields to drop after interest rates had hit the 1988 high the day before. The key 30-year bond rose more than two-thirds of a point, or about $7 per $1,000 in face value, to 100 4/32, lowering its yield to 9.11% from 9.23% at Thursday's close.
"The market is breathing a sigh of relief--for once the news is not bad," said Charles Jensen of MKI Securities.
Confidence had fallen so low, he said, that many investors were braced for bad news. The oversold condition had made stocks technically ready for a rebound, since short sellers were scrambling to buy stocks after the report, he said.
Stocks also got a lift from a Japanese government report showing that Tokyo slashed its trade surplus for the 12th straight month in April.
Tokyo share prices rose sharply on Friday with investors encouraged by aggressive Japanese buying of U.S. government bonds this week and less fearful of a rise in interest rates, brokers said.
They said Wall Street's slight gain overnight and a stable yen-dollar exchange rate also helped the market, with Tokyo's key Nikkei 225-share index soaring 255.73 points to 27,468.31.
In London, share prices rose on the London Stock Exchange on Friday, spurred by new buying on Wall Street.
The Financial Times 100-share index closed up 9.5 at 1,781.8.