Following a protracted series of losses for the main indices, bargain hunters jumped in, helping stocks end higher on Wednesday.
The 10-year Treasury yield dropped down from yesterday’s two-month high, settling down 6.7 basis points at 3.273%, which contributed to today’s favorable price movement. One-hundredth of a percentage point is called a basis point.
Even though Lael Brainard, the vice chair of the Federal Reserve, stated in a speech earlier in the day that the central bank is “in this for as long as it takes to keep inflation down,” purchasing continued. Later this month, the Fed will convene, and the market has essentially priced in the possibility of a third consecutive 75 basis-point rate rise.
Utilities and consumer discretionary stocks led the way with gains of 3.1% and 3.1%, respectively, as almost all sectors closed higher. Energy was the lone outlier, down 1.2% as U.S. oil futures fell 5.7% to $81.94 a barrel, their lowest finish since January 11, according to Dow Jones Market Data, on predictions of a sluggish global economy. According to Dan Wantrobski, technical strategist and associate director of research at Janney Montgomery Scott, “Oil’s breakdown today is a greater shot across the bow, signaling to additional challenges ahead in our opinion.” In the next weeks, “we feel the commodity can fall below $80 from here, hitting the mid-$70s region.”
In terms of the major indices, the Nasdaq Composite increased 2.1% to 11,791 and ended its longest losing run since 2016 of seven days. Impressive increases were also made by the Dow Jones Industrial Average (+1.4% at 31,581) and the S&P 500 Index (+1.8% at 3,979).
Original article posted on kiplinger.com