Stock Market Today: Dow in Comeback as Dip-Buyers Pile into Tech After Yields Jump
By Yasin Ebrahim
Investing.com -- The Dow closed higher Monday as dip-buying in tech and gains in industrials helped spark a comeback after pressure from surging Treasury yields ahead of the Federal Reserve’s interest rate decision due later this week.
The Dow Jones Industrial Average gained 0.6%, or 197 points, the Nasdaq was up 0.76%, and the S&P 500 rose 0.7%.
Tech moved off session lows after falling more than 2% as the 10-year Treasury yield jumped to an 11-year high on expectations for the Fed to deliver a 75-basis-point hike on Wednesday and signal that further tightening will be required to rein in inflation.
“We expect the FOMC to raise rates by 75bps […] and deliver an unambiguously hawkish message. Anyone hoping for a Fed pivot is likely to be disappointed,” Jefferies said in a recent note.
Dip buyers bought the weakness to help big tech recover lost ground, with Facebook (NASDAQ: META ) and Apple (NASDAQ: AAPL ) ending the day sharply higher.
Industrials also played a role in supporting the broader market, led by airline stocks as investors cheered signs that the recovery in higher-margin corporate travel is nearing pre-pandemic levels.
Corporate booking volume for the week ended Sept. 11 was just 17.5% below pre-pandemic levels, according to data from Bank of America.
American Airlines (NASDAQ: AAL ), Alaska Air Group (NYSE: ALK ) and United Airlines Holdings (NASDAQ: UAL ) were more than 3% higher.
Rising bank stocks helped pushed the broader financial sector higher as a rising interest rate environment is expected to bolster the net interest margin for banks.
Energy cut the bulk of its losses as oil prices turned positive as easing COVID lockdowns in China stoked hopes about a rebound in energy demand at a time when many are worried about the impact of slowing global growth.
On the earnings front, AutoZone (NYSE: AZO ) fell 3% despite reporting quarterly results that topped Wall Street estimates, driven by strong performance in its commercial business.
Crypto-related stocks were on the back foot as Bitcoin briefly fell below $19,000 to its lowest level since 2020, before paring some losses.
Coinbase Global Inc (NASDAQ: COIN ), and Riot Blockchain (NASDAQ: RIOT ) ended the day in the red.
In other news, Take-Two Interactive Software (NASDAQ: TTWO ) cut losses after confirming reports that a hacker released gameplay from its upcoming Grand Theft Auto IV game, though the video game maker said the hack wasn't expected to impair the game's development.
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