The stock market was trying to bounce back on Thursday amid a volatile week. The gains were helped by an agreement in Congress to keep government funding.
by mid morning,
It rose 467 points, or 1.4%, after the index fell 461 points Wednesday, to close at 34.022. The
gained 1.2%, and
It increased by 1%.
Republicans and Democrats in Congress Agreed to extend government funding Until mid-February, to avoid a government shutdown this weekend.
Stocks were rebounding from another rout on Wednesday, when an Omicron Covid case was found in California, a day after vaccine and treatment makers announced Treatments were likely to be less effective in immunization against the variant. In addition, the Fed has indicated that it is likely to increase the speed with which it is ending its bond-purchasing program rather than slowing it down.
Thursday morning follows a similar pattern to Wednesday morning: Investors too buy dip. “These buyers have been willing to step in until the news becomes worse or Fed policy is heading for a more hawkish stance sooner,” said Liz Ann Saunders, chief investment analyst at Charles Schwab.
Indeed, the stock market has shown signs of weakness. The S&P 500 is still nearly 3% below its all-time high, hit in late November and trading less than 1% above its 50-day moving average. This indicates a weakening of investor confidence.
In general, “intraday market volatility should be expected when markets become frothy in valuation and highly correlated with monetary adjustment, as they have in recent months and years,” wrote David Bahnsen, chief investment officer at Bahnsen Group.
The “insiders” of the market, or the number of shares that have risen recently, the movements of different types of stocks and those of corporate bonds, were the worst since March 2020, according to a Bear Traps report. Analysts there are recommending selling shares of the S&P 500 and Nasdaq-100 after short rallies “until the Fed gives in on the aggressive pace of accommodation withdrawals.”
In other words, the risks associated with the Federal Reserve are still pending in the market.
The bond market points out the same. The difference between the yield on a 10-year Treasury bond and the yield on a two-year Treasury is only 0.83 percentage points. That’s lower than the spread seen at Wednesday’s close, which was the smallest spread since January 5. This suggests that bond investors see higher inflation in the short term, which could prompt the Fed to raise interest rates soon, and thus lower economic demand and inflation in the long term.
“Historically, the curve becomes flat when the Fed tightens or is about to,” wrote Peter Bokfar, chief investment officer at Bleakley Advisory Group.
The latest economic data showed that initial jobless claims remained near pandemic lows of 222K, better than expectations of 240K.
The real test for the job market comes on Friday, when the Bureau of Labor Statistics releases its employment report for November. Economists expect a payroll gain of 573,000, which would be higher than the October result of 531,000. This strength in the labor market may be a good sign for the economy, but it may encourage the Fed to reduce economic support fairly quickly.
Overseas, Hong Kong
It rose 0.6% while the pan-European rose
slipped 1.1%. European stock markets fell broadly as they matched the declines On Wall Street Wednesday.
Here are five stocks on the move on Thursday:
(Stock symbol: Snow) rose 11% after the company announced it Better-than-expected quarterly results Wednesday.
(AAPL) down 2.5% amid Reports indicate weak demand for iPhone.
CRWD stock rose 3% after that The cybersecurity company has boosted its forecast for the fiscal year.
(five) shares rose 2.6% after the company’s announcement he won 43 cents a share, beating estimates of 29 cents a share, on sales of $608 million, beating expectations of $564 million.
(BA) stock rose 4.3% after regulators in China said the company could fly the Boeing 737 Max.