It took some time but Wall Street eventually got used to the higher prospects for a June rate hike this week. 

Priced-in expectations helped boost equities to their best weekly gain in weeks. Since Monday, the S&P 500 gained 2.1%, the Dow Jones Industrial Average rose 2%, and the Nasdaq climbed 3.3%. The S&P 500 enjoyed its best weekly gain since early March. 

The Federal Reserve will adopt a gradual approach to rate hikes, although another increase over the summer could be warranted, Chair Janet Yellen said during an event on Friday afternoon.

"It's appropriate for the Fed to gradually and cautiously increase our overnight interest rate over time," Yellen said during a Q&A Friday with Harvard Professor Greg Mankiw. 

Yellen's comments coalesce with the past two weeks of Fed rate-hike chatter that has pushed the likelihood of a June rate hike much higher. Markets have slowly come to terms over the past week with the higher probability of a June rate hike, placing the odds at about 26%.

Incoming economic data could make another rate hike appropriate "fairly soon," Federal Reserve Governor Jerome Powell noted at the Peterson Institute for International Economics earlier in the week. Powell argued that continued job growth and increases in wages would be needed to justify another hike.

"Depending on the incoming data and the evolving risks, another rate increase may be appropriate fairly soon," Powell said.

Crude oil also gave equities a boost over the week. West Texas Intermediate closed at its highest level since October 9 earlier on Wednesday and briefly topped the psychologically-important $50-mark.

Oil has been on a tear as a reduction in domestic production has filtered down to eat into inventories. A drop in domestic production and crude stocks has overshadowed continued oversupply on global markets. 

West Texas Intermediate crude gained 1.9% over the past five days. 

Growth in the U.S. economy over the first quarter was upwardly revised from an initial estimate, though not by as much as some had hoped for. The U.S. economy grew at a pace of 0.8% in the first quarter, above a previous estimate showing 0.5% growth.

A stronger U.S. dollar, weaker global growth and chaotic financial markets weighed on the U.S. economy, though not as badly as initially feared. Personal consumption was unchanged at 1.9%, its lowest in three quarters.

"No doubt an upward revision of any size helps alleviate the pain of a weaker-than-expected first round Q1 growth report, but a minimal increase does little to reinforce optimism of better times ahead," said Lindsey Piegza, chief economist at Stifel. "Nevertheless, the hawks at the FOMC ... will no doubt highlight any additional upward revision as support to their thesis of fundamental strength in the U.S. economy."

Orders for long-lasting, or durable, goods in the U.S. rose at a faster-than-expected pace in April as demand for new cars, trucks and commercial jets boosted the metric. Durable goods orders rose 3.4% in April, well above estimates of 0.9% growth.

The housing sector continued to show strength in April with both pending home sales and new home sales coming in above forecasts. Pending home sales in the U.S. surged to a 10-year high in April. New home sales rocketed 16.6% higher in April as builders increased construction to meet demand.

A number of retailers reported their quarterly performances in the tailend of the first-quarter earnings season. GameStop (GME) - Get Report posted disappointing same-store sales in its first quarter, triggering fears over a slowdown. Electronics retailer Best Buy (BBY) - Get Report also disappointed, forecasting a softer-than-expected second quarter and announcing the departure of chief financial officer Sharon McCollam.

Big-box store Costco (COST) - Get Report reported a mixed quarter in which a stronger U.S. dollar and lower gas prices ate into the topline. The second-largest retailer in the U.S. by sales said comparable sales rose 3% when excluding currency exchange and fuel prices.

Costcois a holding in Jim Cramer'sAction Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sellsCOST?Learn more now.

Sears (SHLD) generated goodwill after reporting a narrower-than-expected net loss and a slower decline in sales than forecast. DSW (DSW) - Get Report slumped after reporting a smaller-than-expected first-quarter profit and reducing its full-year outlook on weaker shoe sales.

It was also a big week for deals news. Bio-pharmaceutical company Thermo Fisher (TMO) - Get Report agreed to buy FEICo. FEIC in an all-cash deal worth $4.2 billion, representing a 14% premium to Thursday's close.

Thermo Fisheris a holding in Jim Cramer'sAction Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sellsTMO?Learn more now.

Hewlett Packard Enterprise (HPE) - Get Report announced plans to spin off its enterprise services unit, which will then merge with Computer Sciences (CSC) . HPE shareholders will hold 50% of the newly formed company. 

Monsanto (MON) announced that Bayer's (BAYRY) bid was too low, though it was open to continued negotiations. The U.S.-based agricultural company said the bid undervalues Monsanto and does not adequately address regulatory risks.