Indices 2/10, page-176

Wall Street revives as Treasury yields ease

Oct 5, 202307:12 GMT+11

MSFT+1.78%TSLA+5.93%AMZN+1.83%AAPL+0.73%
KEY POINTS:

• U.S. indexes advance; Nasdaq up 1.35%
• Cons discretionary leads S&P 500 sector gainers; energy tanks as crude plunges >5%
• Dollar dips; gold ~flat; bitcoin edges up
• 10-yr U.S. Treasury yield down to 4.73%

WALL STREET REVIVES AS TREASURY YIELDS EASE (1605 EDT/2005 GMT)
Wall Street rebounded with interest rate sensitive momentum stocks, enjoying a respite from rising Treasury yields, providing much of the upside muscle.
All three major U.S. stock indexes advanced on the session with megacap tech and tech-adjacent stocks, including Microsoft MSFT, Tesla TSLA, Amazon.com AMZN and Apple AAPL helping lift the Nasdaq up 1.4%.
The benchmark S&P 500 rebounded, gaining 0.8% from its lowest closing level since early June.
Among the 11 major sectors of the S&P 500, energy SPN was the session's clear outlier, tumbling 3.4% as crude prices CL1! plunged on signs of weakening demand.
Benchmark Treasury yields eased back from 16-year highs as investors got acclimated to the notion of "higher for longer," as it applies to Fed policy rates.
A swath of data appeared to offer evidence that the Fed's effort to thread the needle - to loosen the labor market and rein in inflation without tipping the economy into recession - could be working as intended.
ADP showed a 41.8% downside surprise in private sector job adds, factory orders blasted past expectations, demand softened in the services sector, and mortgage rates touched new multidecade highs.
Aside from the data, the session was short on market-moving catalysts.
Market participants eye this Friday's employment report, which is expected to show 170,000 job adds, with the unemployment rate and annual wage growth coming in at 3.7% and 4.3% respectively.
Beyond that, third quarter reporting season hits the ground running a week from Friday.
Analysts currently see S&P 500 earnings for the July-September period growing 1.6% from last year, according to LSEG.
Of the 125 companies to issue pre-announcements, 41 have been positive compared with 78 negative, per LSEG.