After recovering from dismal performance in the previous two weeks, stocks rose on Monday, led by consumer and technology stocks. The Nasdaq set the pace for the other major US stock averages, rising more than 3%.
The Nasdaq Composite (COMP.IND) term +3.4%the S&P 500 (SP500) closed +2.7% and the dow (DJI) finished +1.9%.
As for the closing numbers, the Nasdaq rose 354.41 points, closing the session at 10,675.80. The Dow rose 550.99 points to close at 30,185.82, while the S&P 500 advanced 94.88 points to close at 3,677.95.
The broad-based rally saw record gains in all 11 S&P sectors. Consumer discretionary led the advance, jumping 4.2%. There were also gains of more than 3% in communication services, information technology and real estate.
Before the session, the S&P 500 and the Nasdaq had finished lower in seven of the previous eight sessions, including a downdraft last Friday that included a more than 3% drop in the Nasdaq. The S&P hit a yearly low on Thursday.
The sale had been prompted by concerns about inflation and concerns that the Federal Reserve would have to live out its more aggressive interest rate hike plans to rein in price increases.
This week started with a new focus, with investors turning their attention to the quarterly earnings season. Corporate results have been generally strong early on, including strong reports from Bank of America and BNY. Later this week, big names like Tesla, Netflix and Johnson & Johnson will release the results.
Looking at the bond market, trading was mixed. The 10-year Treasury yield (US10Y) rose almost 2 basis points to 4.02%, while the 2-year yield (US2Y) fell 5 basis points to 4.46%.
The UK remained a topic of conversation as the continued fragility of the gilt market remains a potential source of volatility.
“We shouldn’t underestimate how much the relatively small UK market has hit global markets in recent weeks,” said Jim Reid of Deutsche Bank. “Policy is slowly moving in a more market-friendly direction due to a strong Gilts sell-off on Friday afternoon that left a bad taste in our mouths at the end of the week.”
Elsewhere on the world stage, news from China has also weighed on US trade. The country’s leader, Xi Jinping, addressed the Chinese Communist Party Congress over the weekend.
In his remarks, Xi doubled down on the country’s zero-COVID policy, but also outlined plans for a “new giant leap” for the country’s economy. In response, China-based tech names received an offer, adding to Monday’s advance. This included gains from Alibaba, Tencent and Baidu.
On a light day for economic news, New York’s October Empire State manufacturing figures came in at -9.1. The figure represented a deterioration from the -1.5 reading seen in the previous report.
Among the active stocks, Cano Health suffered a sell-off following a report that CVS Health had decided not to pursue an acquisition of the company.