(CNBC) U.S. stocks surged on Friday, lifting the Dow industrials and S&P 500 to record closes, after the Bank of Japan unexpectedly expanded stimulus, increasing hopes for the global economy.
"A lot of the fears that led to the selloff in the middle of October turned out to be unfounded, and U.S. interest rates are even lower than when we started, which makes the case for equities even stronger," said David Kelly, chief market strategist at J.P. Morgan Funds, referencing a 7.4 percent decline in the S&P 500 over a four-week period ending Oct. 15.
"Relative to where we were two weeks ago, we know earnings are going to be good, with 75 percent beating, which is the strongest since 2010, so it's a very good earnings season, and we didn't know that two weeks ago. Another part of it is good numbers for the U.S. economy, and then of course you have Japan, so the market had a lot of momentum going into today," Kelly said.
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"So it's clear the selloff in the middle of October was unjustified," Kelly added.