Dow surges 765 points as Wall Street attempts to recover from brutal September
Oct 04, 2022
New York [US], October 4: Wall Street's three major averages staged a marked comeback on Monday as equities tried to crawl out of a dreadful September.
The Dow Jones Industrial Average surged 765.38 points, or 2.66 percent, to 29,490.89. The S&P 500 increased 92.81 points, or 2.59 percent, to 3,678.43. The Nasdaq Composite Index was up 239.81 points, or 2.27 percent, to 10,815.43.
It marked the best day since June for the Dow, and the best day since July for the S&P 500.
All the 11 primary S&P 500 sectors ended in green, with energy and materials up 5.77 percent and 3.4 percent, leading the gains.
Lending support to the rally was a retreat in U.S. Treasury yields. The yields on the 10-year U.S. Treasury and the 2-year note both declined on Monday. The equity markets usually move negatively with bond yields, as higher bond yields would make equity investments less attractive.
Investors digested the latest data from the Institute for Supply Management (ISM), which showed U.S. manufacturing activity barely holding in expansion territory in September.
The ISM manufacturing PMI (Purchasing Managers' Index) registered 50.9 percent last month, down from the 52.8 percent recorded in August. Economists polled by The Wall Street Journal had forecast the index would drop to 52 percent.
Despite Monday's rebound, experts cautioned more turbulence ahead for markets.
"Investors should brace themselves for another bumpy ride as a multitude of uncertainties are likely to keep already fragile market sentiment on edge," UBS analysts said in a note on Monday.
"The U.S. economic outlook remains uncertain amid persistently high inflation," they said, adding "the Federal Reserve's next move remains a key driver of the market."
U.S. equities have been battered this year amid fears that the Fed's aggressive policy tightening could throw the economy into a recession.
In September, the Dow dropped 8.8 percent, the S&P 500 tumbled 9.3 percent and the Nasdaq lost 10.5 percent.
Source: Xinhua
