Stocks reverse some gains after sharp two-day rally on Wall Street, Dow falls 400 points

U.S. stocks fell on Wednesday as Treasury yields rose, giving back some of their sharpest gains from the past two sessions.

The Dow Jones industrial average fell 417 points, or 1.4%. The S&P 500 and Nasdaq Composite fell 1.7% and 2.3%, respectively.

Treasury yields Back on Wednesday, weight on stocks. The 10-year yield rose 10 basis points to trade at 3.713% after briefly dipping below 3.6% in the previous session.

Private payrolls rose 208,000, with ADP topping the Dow Jones estimates in its latest report. Traders are still awaiting the release of the non-farm payrolls report on Friday.

“Five bear markets since 1950 have ended in October,” Sam Stovall, CFRA’s chief investment strategist, told CNBC’s “Squawk on the Street.” However, “I think we still have a ways to go. We’re down 25%, but markets with recessions typically do so within a 15-month period of 35%. As we have these relief rallies, we could continue to bear down into the first quarter of next year.”

On Tuesday, the Dow rose 825 points, or 2.8%. The S&P 500 gained nearly 3.1%, while the Nasdaq composite advanced 3.3%. Those gains, coming on the back of falling bond yields, led to the S&P 500’s strongest two-day stretch since 2020.

Market participants wondered if those signs meant markets had finally eased after a sharp decline in the previous quarter.

“I don’t think you have to worry about a recession until the second half of ’23,” Stifel chief equity strategist Barry Bannister said Tuesday on CNBC’s “Closing Bell: Overtime.” “So there’s room for a rally as you go early next year.”

See also  Boris Johnson No-confidence vote: Live News Updates

Leave a Reply

Your email address will not be published.