Stocks on
The S&P 500 rose 1.6% to an almost 2-month high, while the Nasdaq gained 2.6%. Both indexes more than recouped losses earlier in the week. The Dow Jones Industrial Average rose 1.3% and the Russell 2000 index of smaller companies ended 1.4% higher.
Technology companies, retailers and communications companies were some of the biggest winners. Only energy sector stocks fell, dragged down by lower oil prices.
Investors cheered a report on the services sector, which makes up the bulk of the
Some weak recent data on the economy heightened speculation that the peak for inflation and for the Federal Reserve’s aggressive rate hikes may be approaching or has already passed. The weak data, though, also shows the risk of a recession as the Fed puts the brake on the economy.
That’s why Wednesday’s more positive economic reports helped put traders in a buying mood.
“That just provides people with more evidence that this economy is hanging in there,” said
The S&P 500 rose 63.98 points to 4,155.17. It had been down nearly 1% for the week heading into Wednesday. It's now up 0.6% for the week.
The Dow gained 416.33 points to 32,812.50. The Nasdaq added 319.40 points to end at 12,668.16. The Russell 2000 picked up 26.48 points to 1,908.93.
The yield on the 10-year
The S&P 500's bumpy start this week follows its best month since late 2020. July was a rare winning stretch for the market, which has struggled this year under worries about the highest inflation in 40 years and rising interest rates from the
Earnings remain in focus this week as investors parse the latest results and statements from companies to better understand how inflation is affecting businesses and consumers.
Drugstore chain CVS rose 6.3% after reporting solid financial results and raising its profit forecast for the year.
Several companies, though, have slipped amid disappointing results.
PayPal jumped 9.2% on a report that activist investor
Oil prices fell following
The pullback in oil prices weighed on energy sector stocks.
Markets are also watching for potential economic fallout from
Upcoming data on the jobs market could help investors determine how the
“Expectations for Fed rate hikes maybe got a little bit too aggressive,” Buchbinder said. “We don't know if we get a pause by year end, but there's a decent chance we get a signal for a pause by year end.”
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