Though there were some down days, stocks ended the week on a strong note. Stocks rocketed higher on Friday, buoyed by a weaker dollar which boosted oil prices as well as prospects for multinational companies.
The S&P 500 was up 0.9% on Friday, 10 points from its all-time high, while the Dow Jones Industrial Average added 0.94%, 160 points from its record. The Nasdaq climbed 0.7%, above 5,000 again.
"[There's been] a lot of discussion about currency and what that means for earnings, what it means around the globe for growth, and for us on our tightening path," said Federated Investors senior equity strategist, Linda Duessel, in a call. "Investors are thinking the dollar is doing the Fed's own tightening."
The euro strengthened against the U.S. dollar on signs of progress in Greece's debt talks with the European Union. Following a meeting, Prime Minister Alexis Tsipras agreed to hasten the details of his reform plans in exchange for bailout funds.
In response, the U.S. dollar slid further from 12-year highs. The greenback was down 1.4% against the euro, 1.3% against the British pound, 1.7% against the Aussie dollar, and 1.3% against the Swiss franc.
A stronger dollar has hit the profitability of numerous multinational companies recently. On Friday, Dow component Nike (NKE) - Get Report reported sales weakened by foreign exchange headwinds, though shares jumped 4.5% as results beat expectations.
Likewise, Tiffany (TIF) - Get Report suffered foreign exchange challenges in its recent quarter, reporting earnings of $1.47 a share, below estimates of $1.51. Net sales increased 3% on a constant-currency basis.
"Our expectation that the dollar will remain underpinned by the relative stance of monetary policy in the U.S. and elsewhere is a key reason why we forecast the S&P 500 to struggle to make further headway this year," said Capital Economics' John Higgins. "Admittedly, the rally in the dollar may not have a lot further to run. But unless the U.S. currency subsequently weakens substantially, the earnings of U.S. [multinationals'] foreign affiliates will not rebound quickly."
The price for West Texas Intermediate crude, which is denominated in U.S. dollars, was pushed higher as demand for domestic oil was seen to increase as it became relatively cheaper. Crude jumped 4% to $45.72 a barrel. Also boosting the commodity, traders were re-positioning their portfolios ahead of the expiry of futures for April delivery.
"The petroleum markets have turned higher, with optimism over a Greek reform pledge helping support the euro vs. the dollar, and an apparent April WTI contract expiration mini-squeeze as a further support," said Citi analyst Tim Evans. "We'd say it's unclear if either of these supports will carry over into Monday's trade ... Today's strength is paper market tightness, unrelated to the physical market."
On the earnings calendar next week, Carnival (CCL) - Get Report will report earnings on Monday morning, HD Supply Holdings (HDS) - Get Report and IHSInc. (IHS) are scheduled for Tuesday morning, and RedHat (RHT) - Get Report will report on Wednesday afternoon. On Thursday morning, ConAgra Foods (CAG) - Get Report and Lululemon (LULU) - Get Report will release earnings, and shoe retailer FinishLine (FINL) will report on Friday morning.
Weather will be a big factor affecting economic data out next week. A harsh winter will likely have dragged on February's existing home sales data out Monday morning, while new home sales out Tuesday could also show weakness.
Also out Tuesday, consumer prices over February are expected to be slightly better than a month earlier, though still showing weakness as energy prices drag on the headline number. Recent industrial weakness could also show up in the February durable goods orders data out on Wednesday morning.