Monday, May 02, 2022

DJIA: 33,061.50, up 84.29
S&P 500: 4,155.38, up 23.45
Nasdaq: 12,536.02, up 201.38

Stocks rally in final hour; yields rise

U.S. stocks finished higher in another wild session Monday. The S&P 500 rose 0.6%, recouping a morning retreat of 1.7%. The broad benchmark is trading around its lowest level in a year, coming off its steepest monthly slide since March 2020 (-8.8%) and worst April performance since 1970. The Nasdaq Composite experienced a relief rally, rebounding 1.6% in the final hour of trading after the tech-heavy index suffered its sharpest monthly drawdown since October 2008 (-13.3%). The Dow added 84 points following its fifth straight weekly decline and 4.9% April drop. Treasuries extended their rout, with the yield on the 10-year note climbing seven basis points (0.07%) to 2.99% on the heels of its largest monthly advance since December 2009 (+0.59%). Notably, the benchmark yield breached the 3.00% level for the first time since 2018 during intraday trading.

Six of 11 S&P 500 sectors closed in positive territory, with Communication Services pacing gains. Technology offered another bright spot amid strength in chipmakers. Energy shares also ended higher, with West Texas Intermediate crude adding 0.8% to $105.56/barrel. Bond proxies and defensive groups lagged. In corporate news, Activision Blizzard Inc. advanced 3.3% after Berkshire Hathaway Inc.’s CEO Warren Buffett revealed the conglomerate increased its stake in the videogame maker.

On the data front, an update from the Institute for Supply Management (ISM) revealed U.S. manufacturing growth unexpectedly deaccelerated in April, with the purchasing managers’ index (PMI) slipping to the lowest level since 2020 at 55.4. Separately, construction spending rose a smaller-than-expected 0.1% in March. The highlight of this week will be the Federal Reserve’s policy decision, due Wednesday afternoon.

Read more about it here.