Wall Street rallies, on track for weekly gains as Treasury yields fall

  • Indices set for weekly earnings
  • The S&P 500 exceeds the 50-day moving average
  • Indices up: Dow 0.85%, S&P 1.29%, Nasdaq 1.66%

NEW YORK, March 3 (Reuters) – Wall Street rose towards the end of a seesaw week on Friday as U.S. Treasury yields eased and economic data helped investors outpace rising odds. that the Federal Reserve maintains its restrictive policy. in place longer than expected.

All three U.S. equity indices were positive, led by the tech-laden Nasdaq, which got a strong boost from market-leading, interest-rate-sensitive megacaps. US Treasury yields eased on comments from Fed officials that eased inflation and interest rate fears.

For the week, the indices appear to be on track for gains, with the S&P posting a three-week losing streak and the Dow enjoying its first weekly gain since late January.

The week also saw the benchmark S&P 500 cross its 50- and 200-day moving averages, two closely watched technical levels.

“You have an oversold market, which has been trading at major support levels and is above the resistance level of the 50-day moving average,” Robert Pavlik, senior portfolio manager at Dakota Wealth told Fairfield, Connecticut. “It’s an indication that a change is happening. And a lot of people are suspicious of it, but they don’t want to be left behind.”

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Economic data released on Friday showed stable demand for services, with the Institute for Supply Management and S&P Global’s Purchasing Managers’ Indexes (PMIs) indicating that activity in the sector continues to expand even as prices inputs decrease.

“There is no indication that we are going off a cliff,” Pavlik added. “The job market is still very strong and this morning’s data indicates a soft landing.”

As of 1:56 p.m. ET, the Dow Jones Industrial Average (.DJI) rose 279.29 points, or 0.85%, to 33,282.86, the S&P 500 (.SPX) gained 51.18 points, or 1.29%, to 4,032.53 and the Nasdaq Composite (.IXIC) added 189.80 points, or 1.66%, to 11,652.78.

Among the 11 major S&P 500 sectors, all but Consumer Staples (.SPLRCS) were in positive territory, with Communication Services (.SPLRCL) and Consumer Discretionary (.SPLRCD) enjoying the largest percentage gains .

The fourth-quarter earnings season is on the home stretch, with all but seven S&P 500 companies reporting. Earnings for the quarter beat consensus estimates 68% of the time, according to Refinitiv.

Still, overall, analysts estimate S&P 500 earnings will have fallen 3.2% in the fourth quarter from a year earlier, and expect negative year-on-year numbers for the first two quarters. of 2023. This would imply that the S&P 500 entered a three-quarter earnings slump in the final months of 2022, per Refinitiv.

Apple Inc (AAPL.O) jumped 2.9% after Morgan Stanley said the stock could rebound more than 20% this year on a possible hardware subscription.

Broadcom Inc (AVGO.O) rose 5.5% after the chipmaker forecast second-quarter revenue above analysts’ estimates as increased investment in AI boosted demand for the chips.

Among the losers, Costco Wholesale Corp (COST.O) slid 2.8% on the heels of its revenue loss as high inflation dampened consumer demand.

Chipmaker Marvell Technology Inc (MRVL.O) fell 6.3% on the company’s quarterly revenue shortfall and disappointing revenue forecast.

Advancing issues outnumbered declining ones on the NYSE by a ratio of 4.63 to 1; on the Nasdaq, a ratio of 2.33 to 1 favored advancers.

The S&P 500 posted 21 new 52-week highs and two new lows; the Nasdaq Composite recorded 73 new highs and 49 new lows.

Reporting by Stephen Culp; Additional reporting by Sruthi Shankar in Bengaluru; Editing by Cynthia Osterman

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