Global shares bounced in volatile trading on Friday with debate over the timing of future interest rate rises on both sides of the Atlantic intensified by euro zone inflation jumping to a 13-year high.
Earlier in the week, global shares suffered their worst rout since January with major U.S. and European indices feeling the heat. The S&P 500 had its worst month since the onset of the pandemic in September, reflecting concerns about COVID-19, inflation fears and budget wrangling in Washington.
The first day of October, the month for some of history's most infamous market routs, marked a see-saw session with major indices repeatedly switching direction amid investor uncertainty.
Read more: Stocks perform mixed
MSCI's gauge of stocks across the globe gained 0.45%.
Prior to Friday's rally, the index had been on track for its longest daily losing streak since last February.
Wall Street strengthened as the day progressed, with sentiment boosted by drugmaker Merck announcing progress in the development of an oral COVID-19 drug and rising hopes an infrastructure bill will be passed.
Even so, all three indexes ended lower than last Friday's close, with the S&P 500 and the Nasdaq posting their biggest weekly percentage drops since February.
The Dow Jones Industrial Average rose 483.53 points, or 1.43%, to 34,327.45, the S&P 500 gained 49.55 points, or 1.15%, to 4,357.09 and the Nasdaq Composite added 118.12 points, or 0.82%, to 14,566.70.
In Europe, it was a different picture with the STOXX 600 index falling 0.4%.
"There's clearly still plenty of nerves in the markets at the moment, which is perfectly understandable under the circumstances," said OANDA analyst Craig Erlam.
Read more: Price fall in large-cap drives stocks down
"There's an enormous amount of uncertainty as we move into the end of the year and central banks removing stimulus, even raising rates, in the midst of that doesn't inspire confidence."
With stellar economic growth figures now in the rear view mirror, markets are looking ugly going into October, Michael Hewson, chief markets analyst at CMC Markets, said.
"There is a sense that, with October's reputation, worries about surging energy prices, supply chain disruptions, concerns about inflation and power shortages, October could be a fairly windy affair," Hewson said.
