Wall Street closes with sharp gains as final quarter begins

Date:

  • US factory activity slows in ~2.5 years in September -ISM
  • Credit Suisse and Citi lower 2022 year-end target for S&P 500
  • Dow, S&P 500, Nasdaq up

Oct. 3 (Reuters) – Wall Street stocks closed sharp gains Monday as the start of the final quarter of a tumultuous year of rate hikes amid historically high inflation and fears of slowing economic growth.

All 11 major S&P 500 (.SPX) sectors moved into positive territory, with energy (.SPNY) being the biggest winner.

Data showed manufacturing activity rose at its slowest pace in nearly 2-1/2 years in September as new orders dwindled, likely because rising interest rates to curb inflation cooled demand for goods. read more

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The Institute for Supply Management said the manufacturing PMI fell to 50.9 this month, with no estimates but still above 50, indicating growth.

“The economic data stream actually came in worse than expected. In a very counterintuitive way that is probably good news for stock markets,” said Art Hogan, chief market strategist at B. Riley Wealth in Boston.

“(While) good economic data, strong results has been a catalyst for sales, this is the first time we’ve actually seen negative news act as a catalyst.”

Further support for interest-rate sensitive growth stocks, yields on US 10-year Treasuries fell after British Prime Minister Liz Truss was forced to veer towards a top-rate tax cut.

“US yield markets are retreating — that’s been positive… and that implies a more risky environment,” Hogan said.

All three major indices ended a volatile third quarter lower on Friday amid growing fears that the Federal Reserve’s aggressive monetary policy will plunge the economy into recession.

According to preliminary data, the S&P 500 (.SPX) gained 92.81 points, or 2.54%, to finish at 3,678.43 points, while the Nasdaq Composite (.IXIC) gained 235.42 points, or 2.23% to 10,811.04. The Dow Jones Industrial Average (.DJI) rose 764.52 points, or 2.63%, to 29,480.41.

Citigroup and Credit Suisse became the latest brokers to lower their year-end targets for the S&P 500 for 2022 as U.S. stock markets endure the heat of aggressive central bank moves to curb inflation. read more

Credit Suisse also set a 2023 year-end price target for the benchmark index at 4,050 points, adding that 2023 would be a “year of weak, non-recessionary growth and falling inflation.”

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Reporting by Echo Wang in New York; Additional reporting by Ankika Biswas and Bansari Mayur Kamdar in Bengaluru; Editing by Anil D’Silva, Arun Koyyur and Richard Chang

Our Standards: The Thomson Reuters Trust Principles.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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