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NEW YORK — Wall Street shook off a trio of disappointing economic reports and forged ahead with its fall rally Friday, posting a fourth consecutive weekly win for the first time in more than two months. 

Analysts attributed the recovery and subsequent rally to buying momentum that built up throughout October. 

“Investor psychology has changed. The market has become very resilient to bad news. Today is a good example of that,” said Michael Murphy, head trader at Wachovia Securities in Baltimore. “Nobody wants to be left behind.” 

Stocks overcame news that consumer spending and manufacturing activity declined and that the unemployment rate increased. 

The Dow Jones industrial average closed up 120.61, or 1.4 percent, at 8,517.64, after falling as much as 87 in early trading. The advance came after the Dow had its second-best October with a gain of 10.6 percent, just short of the 10.7 percent advance in October 1982. It also was the Dow’s best month since January 1987 when the blue chips rose 13.8 percent. 

The broader market also recovered, moving into positive territory. The Nasdaq composite index rose 30.95, or 2.3 percent, to 1,360.70, having advanced 13.5 percent in October. The Standard & Poor’s 500 index rose 15.20, or 1.7 percent, to 900.96, following its monthly advance of 8.7 percent. 

The indexes scored a four-week winning stretch for the first time since the four weeks that ended Aug. 23. For the week, the Dow rose 0.9 percent.