The Dow Jones Industrials popped 328.69 points, or 1%, to end Friday at 33,093.34.
The S&P 500 gained 54.17 points, or 1.3%, to 4,205.45.
The NASDAQ hiked 277.59 points, or 2.2%, to 12,975.69.
The NASDAQ notched its fifth straight weekly gain, rising 2.5%. The S&P 500 also posted a one-week advance, picking up 0.3%. The Dow was the laggard this week, losing 1%.
U.S. markets will be closed Monday for Memorial Day.
Intel gathered 5.8%, and American Express rose 4.1%, to lead the Dow higher. The S&P 500 tech and consumer discretionary sectors popped more than 2% each.
House Speaker Kevin McCarthy left the Capitol Thursday night saying a deal had not been reached yet. However, sources told news outlets that the White House and McCarthy are close to reaching an agreement that would raise the U.S. debt ceiling for two years.
Treasury Secretary Janet Yellen has warned that the U.S. could default on its debt as soon as June 1 if the debt ceiling is not raised.
New data out Friday morning showed inflation rose more than expected in April. The personal consumption expenditures index, the Federal Reserve’s preferred gauge of price pressures, increased 0.4% last month and 4.7% from a year earlier.
Prices for the 10-year Treasury gained, lowering yields to 3.81% from Thursday’s 3.82%. Treasury prices and yields move in opposite directions.
Oil prices recovered 96 cents to $72.79 U.S. a barrel.
Gold prices gained $2.90 to $1,946.60 U.S. an ounce.