Stocks notched fresh records on Friday as year-end optimism continued to drive the rally.

The Dow Jones Industrial Average rose 23.87 points to a record close of 28,645.26. The S&P 500 finished the day just 0.11 point higher at 3,240.02, also a new closing high. However, the Nasdaq Composite slipped 0.1%, or 15.77 points, to 9,006.62, snapping a 11-day winning streak. Three major averages all hit new intraday highs earlier in the session. Trading volumes were light throughout the end of the holiday-shortened week.

A year-end rally in December has already ushered the U.S. equity indexes to historic levels and within reach of the market's best calendar year in more than two decades.

The S&P 500, up already more than 29% in 2019, is inches away from reaching historic proportions. The benchmark will post its best year since 1997 with an annual gain of more than 29.6%. The tech-heavy Nasdaq topped the 9,000 mark for the first time Thursday, lifted by a jump in Amazon shares on a record holiday shopping season.

"News flow remains relatively quiet, but stocks are extending their melt-up price action into the final days of 2019," Adam Crisafulli, founder of Vital Knowledge, said in a note on Friday.

Investors have been embracing riskier assets ever since the U.S. and China announced they have reached a phase one trade agreement earlier this month. The two sides are in the middle of translating and formalizing the deal. President Donald Trump said Tuesday there will ultimately be a signing ceremony with Chinese leader Xi Jinping, adding a quicker signing will happen soon.

Data overnight showed a solid rebound for industrial profits in China, further boosting sentiment.

"During what has been a very, very quiet week so far this week, the stock market has continued to rally in a slow and steady manner," Matthew Maley, chief market strategist at Miller Tabak, said in a note Friday. "Many important stock indexes breaking out...but they're also getting overbought."

Friday marks day three of the so-called Santa Claus rally period, which is historically beneficial for stocks. Since 1950, the S&P 500 has rallied an average of 1.3% during the final five trading days of the year and the first two sessions of the new year, according to the Stock Trader's Almanac.