Wall Street gains as volatility eases, Dow up over 200 points

A trader works on the floor of the New York Stock Exchange February 7, 2018. — Reuters pic
A trader works on the floor of the New York Stock Exchange February 7, 2018. — Reuters pic

NEW YORK, Feb 7 — US stocks overturned early losses to trade higher today as some buyers returned to a market still shaking from a record fall for the Dow Jones Industrial Average earlier this week.

At 10.09am ET (1509 GMT/11.09pm Malaysian time), the Dow Jones Industrial Average was up 228.25 points, or 0.92 per cent, at 25,141.02.

The S&P 500 rose 19.12 points, or 0.70 per cent, to 2,714.26 and the Nasdaq Composite was up 22.72 points, or 0.32 per cent, at 7,138.60.

“It looks like a little bit of a stabilisation trade overnight,” said John Brady, senior vice president at futures brokerage RJ O’Brien & Associates in Chicago. “I don’t know if it’s over, but a market range may be established.”

Gains in industrial and consumer discretionary stocks led advances on the S&P and the Dow.

Boeing and United Tech rose about 1.5 per cent, providing the biggest boost to the Dow, while Amazon’s 1 per cent rise helped lift the S&P.

The S&P energy index was up more than 1 per cent, led by Anadarko Petroleum’s 5 per cent gain and an uptick in oil prices.

A wild session yesterday had seen the Dow swing more than 1,100 points from peak to trough and ended with the benchmark S&P 500 recording its best day since just before President Donald Trump’s election in 2016.

Traders are still braced for more volatility as they try to figure out if the swings of the past week are the start of a deeper correction or just a temporary blip in the US market’s nine-year bull run.

The pivotal gauge of S&P 500 volatility, the VIX, opened at a relatively elevated 31 points and slipped to 21.74. The VIX yesterday hit a more than two-and-a-half year high above 50, after trading, on average, below 20 for months.

Some investors fear the market is over-stretched in the context of higher inflation and rising bond yields as central banks withdraw their easy money policies of recent years. The recent rout has wiped about US$4 trillion (RM15.6 trillion) off world equities.

US 10-year yields were at 2.789 per cent, up from 2.766 per cent yesterday.

US President Donald Trump, who has repeatedly praised Wall Street gains during his first year in office, on Wednesday dismissed recent market rout, saying stocks should not be falling amid strong economic news.

“In the ‘old days, when good news was reported, the Stock Market would go up. Today, when good news is reported, the Stock Market goes down. Big mistake, and we have so much good (great) news about the economy!” Trump wrote on Twitter.

Snapchat owner Snap soared 21 per cent after it reported surging growth in users and revenue in its latest quarter.

Advancing issues outnumbered decliners on the NYSE by 2,068 to 720. On the Nasdaq, 1,596 issues rose and 1,056 fell.

The S&P 500 index showed 2 new 52-week highs and no new lows, while the Nasdaq recorded 13 new highs and 21 new lows. — Reuters

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