Wall Street rallies to higher closes boosted by big banks, tech According to Reuters
© Reuters. FILE PHOTO: The New York Stock Exchange (NYSE) in New York City, where markets were active after Russia continued to attack Ukraine, in New York, U.S., February 24, 2022. REUTERS/Caitlin Ochs
By Stephen Culp
NEW YORK (Reuters) – U.S. stocks ended session higher on Monday as interest from banks and a rebound in megacap market leaders supported a broad-based rally following a string of weekly declines. Wall Street’s longest since dotcom went bust more than 20 years ago.
All three major US stock indexes posted solid gains, with the biggest gains provided by a rebound in adjacent growth tech and tech stocks, notably Apple Inc. (NASDAQ 🙂 and Microsoft Corp (NASDAQ:).
Banks are sensitive to a spike in interest rates after America’s largest lender, JPMorgan Chase & Co (NYSE:) raised its interest income outlook for the current year.
“It’s more of a relief rally than a fundamental shift in investor sentiment,” said Oliver Pursche, senior vice president at Wealthspire Advisors, in New York. “Investors generally feel like there’s another shoe to drop and they’re probably right in the short-term.”
On Friday, the close was 18.7% lower than the closing record high reached on Jan. 3. If the benchmark index closes 20% or more below that record, it will confirm that it has been in a bear market ever since.
Markets have been rocked in recent weeks by worries about persistently high inflation and the Federal Reserve’s aggressive efforts to rein it in while the global economy deals with setbacks from the recession. Russian invasion of Ukraine.
“Today, it looks like the markets will be less fearful of the inflation factor and the Fed could arrange a gentle landing,” said Chuck Carlson, managing director at Horizon Investment Services in Hammond, Indiana. “.
“(But) bias is still the flip side of it,” added Carlson.
Market participants can get an idea of the Fed’s position when the minutes of their most recent policy meeting are released on Wednesday. [FEDWATCH]
A range of economic indicators this week could add further support to views that inflation peaked in March, and whether high prices will weigh on consumer spending.
A series of dire warnings from retailers last week, including Walmart (NYSE: Inc and ) Target Corp (NYSE:) has raised such concerns.
According to preliminary data, the S&P 500 rose 71.46 points, or 1.83%, to 3,972.82, while the Nasdaq Composite added 112.40 points, or 1.61%, to 11,531.91. The Dow Jones Industrial Average rose 625.10 points, or 2.00%, to 31,887.00.
The first quarter reporting season is almost over, with 474 companies in the S&P 500 having posted results. Of those, 78% beat expectations, according to Refinitiv.
Looking ahead, announcements ahead of the current quarter are generally pessimistic, with 59 negative and 32 positive, compared with 37 negative and 52 positive for the previous quarter, according to Refinitiv.
Shares of VMWare Inc rose sharply following reports over the weekend that chipmaker Broadcom (NASDAQ:) Inc was in talks to acquire the cloud service provider. Broadcom stock fell on the news.
