by Herbert Lash, Ankika Biswas and Bansari Mayur Kamdar
(Reuters) – The New York Stock Exchange continued its sharp rebound that began the day before on Tuesday, fueled by large technology stocks, the main beneficiaries of the decline in bond yields on the hope that the Federal Reserve will become less aggressive in terms of interest rate hikes.
The Dow Jones Industrial Average gained 2.8%, or 825.43 points, to 30,316.32 points.
The broader S&P-500 rose 112.5 points, or 3.06%, to 3,790.93 points, its biggest gain since May 2020.
The tech-heavy Nasdaq Composite advanced 360.97 points (3.34%) to 11,176.41 points.
The Dow Jones and the S&P-500, which fell to an almost two-year closing low on Friday after experiencing its worst month in September since March 2020 and the start of the COVID-19 crisis, thus recorded their strongest progression over two sessions since April 2020.
Although the job market in the United States remains solid, a report from the Labor Department released on Tuesday showed that job openings in August fell by the most in nearly two and a half years. Some investors want to see this as a sign that the Federal Reserve’s monetary tightening to contain inflation is beginning to bear fruit, which could prompt the Fed to slow the pace of its rate hikes.
This hope was fueled by the unexpected decision of the central bank of Australia to raise its main interest rate by only 25 basis points, which could be the first signal announcing the end of aggressive rate hikes in developed economies.
Growth stocks par excellence, the digital giants Apple, Microsoft, Amazon and Alphabet, whose valuations are particularly dependent on the level of interest rates, gained between 2.5% and 4.5% while the sector index Philadelphia SE Semiconductor climbed 4.46%.
Beyond this sector momentum, Twitter soared more than 22% to $52.0 following reports that Elon Musk would finally agree to buy the social network at the price announced in April, 54.20. dollars per share, or $44 billion.
Tesla, of which Elon Musk is the founder and managing director, on the other hand sharply reduced its earnings to end up limited to 2.9%.
The banking sector also shone with increases of 4.35% to 5.26% for Citigroup, Morgan Stanley and Goldman Sachs.
However, the rise was general, with only about ten S&P-500 stocks trading in negative territory.
(Report Medha Singh, Ankika Biswas and Bansari Mayur Kamdar in Bangalore, written by , French version Bertrand Boucey, edited by)
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