Stocks posted sharp gains on Wednesday as recently surging commodity prices, especially oil, cooled off while the war in Ukraine continues.
The Dow Jones Industrial Average rose about 800 points, or about 2.5%, helped by gains in Salesforce, Nike and JPMorgan. The S&P 500 climbed about 2.8%, on pace for its best day since May 2020, and the technology-focused Nasdaq Composite gained roughly 3.5%.
Oil prices took a sharp leg lower in afternoon trading, giving stocks an extra boost. West Texas Intermediate crude, the U.S. oil benchmark, was last down 10% to around $110, while Brent crude, the international standard, fell 11% to around $114.
Stocks’ bounce came after the market fell for a fourth day on Tuesday, with the S&P 500 and Dow falling deeper into correction territory and the Nasdaq Composite adding to its bear market losses.
The market is reacting to an easing in commodity prices that have spooked stocks lately. Energy and agriculture products, in particular, have catapulted higher amid the fighting in Ukraine, while some metals also have posted major gains.
Wheat futures also were sharply lower, falling 6.3% to $1,206 a bushel, though palladium continued its march higher, rising 3.8% to $3,082 per ounce. Silver, copper and platinum were all lower on Wednesday.
“The equity market continues to take its cues from changes in commodity prices, namely oil,” said Kathy Bostjancic, chief U.S. economist at Oxford Economics. “Trading will continue to be volatile and rally when prices retreat, but overall the prospect of oil and non-energy prices remaining very high casts a cloud overall the outlook for economic activity and the equity market.”
Certain consumer-related stocks roared back on Wednesday after weakness on fears that higher gas prices would dent consumer spending. Nike rose 6% and Starbucks added 3.8%.
Airlines and cruise lines were also higher on Wednesday. Carnival Corp. is up more than 7% and United Air Lines is 7.2% higher.
Treasury prices fell and yields climbed as investors rotated out of bonds after huddling in fixed income for protection amid the Ukraine war. The benchmark 10-year note rose about 3.7 basis points to 1.91%. A basis point equals 0.01%.
Bank stocks moved higher as yields rose. PNC Financial was up 4% and Wells Fargo rose more than 5%. Goldman Sachs and JPMorgan were 3% higher each.
Energy stocks were lower on Wednesday following a strong session Tuesday after President Joe Biden announced a ban on Russian fossil imports, including oil, in response to the country’s invasion of Ukraine.
Pepsico shares rose more than 1% after the soft drink giant said it will suspend sales in Russia, though it will continue to sell snacks and essentials such as baby formula. Elsewhere, shares of dating service Bumble soared 45% after it reported profit and expected growth that was much better than Wall Street expectations.
The major averages all closed lower Tuesday after a day of whipsaw trading. The Dow gave up a 585-point gain to end the day lower by 184 points, falling deeper into its correction. The S&P 500 slid 0.7%, in correction territory. The Nasdaq Composite lost 0.2%, after entering bear market territory Monday.
It remains to be seen if the Federal Reserve will manage a soft economic landing, but the U.S. should be able to avoid a recession, according to Ross Mayfield, investment strategy analyst at Baird.
“The strength of the U.S. labor market, consumer and aggregate corporate sector should act as the weight to keep us out of recession near-term,” he told CNBC. “Overall, volatility is likely to persist, [there’s a] wide range of outcomes possible in Ukraine, but the fundamentals of the U.S. economy still look decent, especially if the Fed can navigate raising rates without breaking demand.”
A Cutting-Edge Cancer Treatment May Cause Cancer. The FDA Is Investigating
Blow for Rishi Sunak as UK to have second-slowest growth in G7
Florida woman who gauged mother's eyes out, put them on cardboard box, pleads guilty to manslaughter
Amazon unleashes Q, an AI assistant for the workplace
Be Careful What You Tell OpenAI’s GPTs
Feeding Tampa Bay serves hundreds a traditional meal for Thanksgiving
Chris Pine Has Heard Rumors of a Possible Dungeons and Dragons 2
Warning: Ability To Convert 529 Funds To Roth IRA Could Be Problematic
29 Early Black Friday Treadmill Deals to Shop Right Now 2023
Ford Kills Explorer Hybrid So It Can Keep Selling Hybrid Interceptor to Police
‘Sister Wives’: When Were the Season 18 Tell-All Episodes Filmed?
The Day Charlie Munger Was Introduced To The World
Here’s what Bill Belichick said about Patriots quarterbacks, including Malik Cunningham
Okta Breach Impacted All Customer Support Users—Not 1 Percent
Is Roche Stock Undervalued At $33?
Tech21 hours ago
Car dealers say they can’t sell EVs, tell Biden to slow their rollout
News22 hours ago
Hamas’s hostages regaining freedom face new tragedy, joy and life changes
Lifestyle21 hours ago
Why Rachel Bilson Once Accidentally Ditched Adam Brody for Olsen Twins
Finance23 hours ago
These Are Some Of The Top Ideas From The Invest For Kids Conference
Finance20 hours ago
5 Best Blue-Chip Stocks For 2024
Auto22 hours ago
Watch This Toyota GR Corolla Go Absolutely Wild On A Dirt Back Road
Lifestyle20 hours ago
The Best TikTok Gifts for Teens They’ll Actually Want
News20 hours ago
Senate Democrats fume as Republican seek to tie Ukraine funding to border security