April 17, 2024

2-Day Rally Loses Pace, Stocks Tumble

Stocks in the US dropped again on Wednesday as Wall Street halted its rally. The sharp market rally lifted the average indexes above their low levels this year.

Indexes Dip Again

The S&P 500 index lost 0.9% of its value on Wednesday. The same was the case for the Dow and Nasdaq Composite.

The development on Wednesday followed the S&P 500’s rise by 5.7% over two days. It was the index’s largest continuous gain in over two years. Ryan Detrick also said the move was the best beginning of a quarter since 1938.

The Dow rose by 1,500 points between Monday and Wednesday. The movement took the index over its significant 30,000 level, out of the bearish zone. It is, therefore, currently just 18% under its latest high.

Nasdaq, on the other hand, rose by 5.6% within the same two days. Twitter shares became a bit lower after it gained 22% on Tuesday. This was a result of Elon Musk getting back to the purchasing table.

Elon Musk is buying the company at his initially proposed rate of $54.20/share. The bid came up days before he was removed as a party in the lawsuit. 

In other places, the US Treasury yields headed higher after its last pullback. The Dollar index also pulled up after declining for five consecutive days. The Dollar has now performed a round trip after its rise following the FOMC meeting.

Depending on Statistics

The US Dollar is now back to its initial point as of the 6th of September. This is according to data made available by Bespoke Group.

OPEC+ is starting its meeting on Wednesday as it considers cutting production. It will be the biggest cut since 2020. It is expected that up to 2 million barrels a day will be cut off.

Officials from the US are pushing against the oil cut move. It is coincidental that West Texas Intermediate lost some value but trades above $86/barrel.

Traders got some rest reprieve from the market due to the early monthly gains. The bonds and stock markets took a break from the vicious selling in September. But analysts are expressing skepticism about the longevity of the rally.

Hargreaves Lansdown’s Susannah Streeter shared her view on the market’s optimism. She said the optimism October brings is still flowing through the market. It is also aided by hopes that the Fed’s rate hike will be reversed.

Investors are holding on to every sign that might point to the Feds policy reversal. Such evidence includes the coming job data. 

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