Wall Street trims Black-Monday's sell-off
- US indexes gain strongly as bonds recovery extends, with yields down for a third consecutive day.
- US core PCE inflation and Powell's testimony before the Congress to take their toll on equities.
Wall Street's advance was quite solid ever since the day started, persisting all through the day and resulting in the three major indexes closing at levels last seen on February 2nd, when the release of the Nonfarm Payroll report, showing a strong wages' growth, triggered a massive sell-off. The Dow Jones Industrial Average closed the day at 25,708.93 up a whopping 398 points, the S&P added 32 points, to 2,779.60 and the Nasdaq settled at 7,421.46 after adding 84 points or 1.15%.
Rising US government bonds backed the rally in equities as yields eased from multi-year highs, with strong gains the financial and the technology sectors leading the way higher. Speculative interest seems to have accepted that inflation is up, and therefore will also be rates. Still is too early to discard further risk-related trading, particularly considering that US Fed's head, Powell will face the Congress on Tuesday and Wednesday, while the US will release on Thursday the core PCE index, the central bank's favorite inflation figure.
The DJIA's daily chart shows that the index re-gained bullish territory, now well above all of its moving averages, and with technical indicators closer to overbought readings than to their mid-lines. The index is down for the month, but still has chances of reversing completely its February losses as the S&P did today, with the Dow's monthly opening at 26,305.5.