1.7 C
New York
Tuesday, March 19, 2024

S&P 500 Climbs Back as Bulls Snap Up Oversold Stocks

S&P 500 Climbs Back as Bulls Snap Up Oversold Stocks
© Reuters.

By Yasin Ebrahim

Investing.com – The S&P 500 rebounded Thursday, as traders loaded up on oversold stocks following a broader market rout a day earlier after the U.S. confirmed its first case of the Omicron variant of Covid-19.

The S&P 500 rose 1.4%, the Dow Jones Industrial Average gained 1.82%, or 619 points, the Nasdaq added 0.83%. and Russell 2000 was up 2.5% 

“Yesterday’s bearish reversal pushes U.S. equities into oversold territory once again and sets us up for another strong rally effort,” Janney Montgomery Scott said in a note. But there is “likely (still) more to go in this current market correction.”

Financials outperformed the broader market, led by banking stocks as Treasury yields rose after some on Wall Street suggested that a potentially more contagious Omicron variant could speed up the end of the pandemic and ultimately cause the yield curve to steepen

“If the market were to anticipate that scenario — omicron could be a catalyst for steepening (not flattening) the yield curve, rotation from growth to value, selloff in COVID and lockdown beneficiaries and rally in reopening themes,” chief global strategist Marko Kolanovic and quant strategist Bram Kaplan wrote in a note to clients.

Regional banks including Fifth Third (NASDAQ:FITB), People’s United Financial (NASDAQ:PBCT), and SVB Financial (NASDAQ:SIVB) were among the biggest gainers in financial, rising more than 4%.

Industrial were also helped by a rebound in airline stocks, led by Boeing Co (NYSE:BA) after China cleared the aircraft maker’s 737 Max to return to the skies on Thursday.  The 737 Max returned to service in China after being grounded for more than two years following two fatal crashes.

Delta Air Lines (NYSE:DAL), Alaska Air (NYSE:ALK), and United Airlines Holdings Inc (NASDAQ:UAL) were also sharply higher.

Energy stocks were boosted by rising oil prices after OPEC and its allies decided to stick with their current plan of lifting oil output by 400,000 barrels a day in January.

In tech, Apple (NASDAQ:AAPL) pared some losses after the tech giant warned some its chip suppliers of weaker demand for its latest iPhones, Bloomberg reported.

Nvidia (NASDAQ:NVDA) ended higher despite losing some steam after The Federal Trade Commission sued to block the chipmaker’s $40 billion acquisition of Arm from SoftBank, citing antitrust concerns.

On the economic front, better-than-expected weekly jobless claims data stoked optimism on the labor market recovery ahead of Friday’s monthly jobs.

The Labor Department reported that 222,000 people filed for unemployment insurance, confounding economists’ expectations for an 18,000 rise.

A blowout jobs report, however, could give force the Federal Reserve to hike rates and spook investors.   

“If the job numbers are way better than expected, pointing to a super strong economy that could spook investors because it would point to Federal Reserve Chairman Jerome Powell having to perhaps be a lot more aggressive than than he thought,” Eric Diton, president and managing director at The Wealth Alliance told Investing.com in an interview earlier this week. “But something in line or even on the strong side would be fine.”

Nonfarm payrolls are expected to have increased by 560,000 in November, with unemployment rate expected to drop to 4.4%.

Source: Investing.com

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

11,268FansLike
12,893FollowersFollow
730FollowersFollow
- Advertisement -

Latest Articles

Popular Articles