NEW YORK, March 30 ― US stocks rose yesterday, with the Dow and S&P notching their fourth straight session of gains, on optimism some progress was being made toward a deal to resolve the conflict between Russia and Ukraine.
Russia pledged to cut down on military operations around Kyiv and in northern Ukraine, while Ukraine proposed adopting a neutral status, the first sign of progress toward peace in weeks.
Prices eased for oil and other commodities, helping calm concerns about rising inflation and the path of monetary policy by the Federal Reserve, which has started hiking interest rates to combat rising prices.
“If you look over the course of the month this war has been going on, the market has priced in much more bad news than good news,” said Art Hogan, chief market strategist at National Securities in New York.
“It certainly shows the market has a natural coiled spring that will be a reaction function to any good news and we saw a bit of that this morning, but everything will have to be taken with a grain of salt and we will have to see things actually play out versus being actually talked about.”
The Dow Jones Industrial Average rose 338.3 points, or 0.97 per cent, to 35,294.19, the S&P 500 gained 56.08 points, or 1.23 per cent, to 4,631.6 and the Nasdaq Composite added 264.73 points, or 1.84 per cent, to 14,619.64.
After a dismal start to the year for stocks that saw the S&P 500 fall into a correction, commonly referred to as a drop of more than 10 per cent from its most recent high, the benchmark index is now down less than 3 per cent on the year.
Still, there were signs of market nervousness that the Fed could make a policy mistake that leads to a slowdown, or possibly a recession, in the economy as the widely tracked US 2-year/10-year Treasury inverted for the first time since September 2019.
“While I think the ultimate result of an aggressive Fed tightening cycle is a recession, I do not expect it to occur quickly. Historically speaking, all recessions are preceded by 2s10s inversions, but not all inversions result in recessions,” said Ellis Phifer, managing director, fixed income research, at Raymond James in Memphis, Tennessee.
After slumping more than 2 per cent on Monday, the S&P energy index was the only declining sector as crude prices fell more than 1 per cent.
As the conflict in Ukraine has escalated in recent weeks, already rising prices saw more upward pressure on commodities such as wheat, energy and metals.
But even with the recent surge in inflation, data yesterday showed US consumer confidence rebounded from a one-year low in March, while the current labour environment favours workers. Read full story
Real estate, up nearly 3 per cent on the session, was the best performing sector, which indicates some investors may see inflation remaining but no recession on the horizon. It was the biggest one-day percentage gain for the group since January 28.
FedEx Corp gained 3.70 per cent after the global delivery conglomerate named operating chief Raj Subramaniam as its top boss.
Volume on US exchanges was 13.22 billion shares, compared with the 14 billion average for the full session over the last 20 trading days.
Advancing issues outnumbered declining ones on the NYSE by a 4.20-to-1 ratio; on Nasdaq, a 2.97-to-1 ratio favoured advancers.
The S&P 500 posted 51 new 52-week highs and no new lows; the Nasdaq Composite recorded 71 new highs and 38 new lows. ― Reuters