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Wall Street closed sharply higher on Friday, with all three indexes posting their best week since June. Investor mood was uplifted by a report suggesting that the Fed would be discussing slowing down the pace of rate hikes from December. The benchmark U.S. 10-year treasury yield slid on the news. All three major indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) jumped 2.5% or 748.97 points to close at 31,082.56 points. Twenty-seven components of the 30-stock index ended in the green, two ended in the red, while one remained unchanged.
The S&P 500 rose 2.4% or 86.97 points to finish at 3,752.75 points. All 11 broad sectors of the benchmark index closed in the green. The Materials Select Sector SPDR (XLB), the Financials Select Sector SPDR (XLF) and the Consumer Discretionary Select Sector SPDR (XLY) advanced 3.5%, 3% and 2.9%, respectively.
The tech-heavy Nasdaq gained 2.3% or 244.87 points to end at 10,859.72 points led by large-cap tech stocks.
The fear-gauge CBOE Volatility Index (VIX) decreased 1% to 29.69. A total of 12.2 billion shares were traded on Friday, higher than the last 20-session average of 11.6 billion. Advancers outnumbered decliners on the NYSE by a 2.59-to-1 ratio. On Nasdaq, a 2.03-to-1 ratio favored advancing issues.
WSJ Report Suggests Fed to Slow Down Rate Hikes
Albeit confirming that the Fed would increase interest rates by another steep 75 bps in their November meeting, a report from the Wall Street Journal published on Friday suggested that Fed officials are likely to debate whether and how to approve a smaller increase in December.
According to the report, various Fed officials have already started to express their desire to slow down the pace of rate hikes soon and to stop raising rates altogether early next year, to take stock on how their moves have been slowing down the economy. They want to reduce the risk of a hard landing of the economy caused by the policy interventions made by the central bank. While other officials have remained steadfast in their commitment to bring down inflation by raising rates, this is a positive sign for the market as investors have been eagerly waiting for signs from the Fed that it would start to slow down its pace of tightening.
“We will have a very thoughtful discussion about the pace of tightening at our next meeting,” Fed governor Christopher Waller had said in a speech earlier this month. San Francisco Fed President Mary Daly echoed that sentiment on Friday and said that a conversation had to start on slowing down the pace and whether further rate hikes might send the economy into an unforced downturn.
The market reacted positively to the news and the 10-year treasury yield fell after a few consecutive sessions of rising. Large-cap growth stocks did well as a result, recovering from early losses brought about by Snap Inc. (SNAP - Free Report) which plumetted 28.1% after posting its slowest quarterly revenue growth in five years. Consumer Discretionary and Financials were the best-performing sectors.
The three most widely followed indexes recorded their biggest gaining week since June despite treasury yields hitting 2008 highs. The S&P 500, the Dow Jones Industrial Average and the tech-heavy Nasdaq advanced 4.7%, 4.9% and 5.2%, respectively. Markets rebounded on strong earnings data and a notion that losses in the week before were due to overselling and that a correction was needed. Reports and comments suggesting that the Fed would start slowing its pace of hikes also helped.
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Stock Market News for Oct 24, 2022
Wall Street closed sharply higher on Friday, with all three indexes posting their best week since June. Investor mood was uplifted by a report suggesting that the Fed would be discussing slowing down the pace of rate hikes from December. The benchmark U.S. 10-year treasury yield slid on the news. All three major indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) jumped 2.5% or 748.97 points to close at 31,082.56 points. Twenty-seven components of the 30-stock index ended in the green, two ended in the red, while one remained unchanged.
The S&P 500 rose 2.4% or 86.97 points to finish at 3,752.75 points. All 11 broad sectors of the benchmark index closed in the green. The Materials Select Sector SPDR (XLB), the Financials Select Sector SPDR (XLF) and the Consumer Discretionary Select Sector SPDR (XLY) advanced 3.5%, 3% and 2.9%, respectively.
The tech-heavy Nasdaq gained 2.3% or 244.87 points to end at 10,859.72 points led by large-cap tech stocks.
The fear-gauge CBOE Volatility Index (VIX) decreased 1% to 29.69. A total of 12.2 billion shares were traded on Friday, higher than the last 20-session average of 11.6 billion. Advancers outnumbered decliners on the NYSE by a 2.59-to-1 ratio. On Nasdaq, a 2.03-to-1 ratio favored advancing issues.
WSJ Report Suggests Fed to Slow Down Rate Hikes
Albeit confirming that the Fed would increase interest rates by another steep 75 bps in their November meeting, a report from the Wall Street Journal published on Friday suggested that Fed officials are likely to debate whether and how to approve a smaller increase in December.
According to the report, various Fed officials have already started to express their desire to slow down the pace of rate hikes soon and to stop raising rates altogether early next year, to take stock on how their moves have been slowing down the economy. They want to reduce the risk of a hard landing of the economy caused by the policy interventions made by the central bank. While other officials have remained steadfast in their commitment to bring down inflation by raising rates, this is a positive sign for the market as investors have been eagerly waiting for signs from the Fed that it would start to slow down its pace of tightening.
“We will have a very thoughtful discussion about the pace of tightening at our next meeting,” Fed governor Christopher Waller had said in a speech earlier this month. San Francisco Fed President Mary Daly echoed that sentiment on Friday and said that a conversation had to start on slowing down the pace and whether further rate hikes might send the economy into an unforced downturn.
The market reacted positively to the news and the 10-year treasury yield fell after a few consecutive sessions of rising. Large-cap growth stocks did well as a result, recovering from early losses brought about by Snap Inc. (SNAP - Free Report) which plumetted 28.1% after posting its slowest quarterly revenue growth in five years. Consumer Discretionary and Financials were the best-performing sectors.
Consequently, shares of Netflix, Inc. (NFLX - Free Report) and JPMorgan Chase & Co. (JPM - Free Report) rose 8% and 5.3%, respectively. JPMorgan Chase carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Weekly Roundup
The three most widely followed indexes recorded their biggest gaining week since June despite treasury yields hitting 2008 highs. The S&P 500, the Dow Jones Industrial Average and the tech-heavy Nasdaq advanced 4.7%, 4.9% and 5.2%, respectively. Markets rebounded on strong earnings data and a notion that losses in the week before were due to overselling and that a correction was needed. Reports and comments suggesting that the Fed would start slowing its pace of hikes also helped.