Published: Sat, December 29, 2018
Money | By Hannah Jacobs

Dow soars 500 points as stock market bounces back

Dow soars 500 points as stock market bounces back

Some of what Wall Street sees coming out of the White House has added to the market's uncertainty, specifically the president's attacks on the Fed and remarks about the ongoing trade conflict with China.

Gains in technology companies, retailers, health care and internet stocks drove the broad rally, which gave the benchmark S&P 500 index some breathing room after it slid Monday to just shy of what Wall Street calls a bear market - a 20 percent fall from an index's peak.

Investors recouped all their losses from a Christmas Eve plunge as stocks rallied across all sectors, giving the Dow and benchmark S&P 500 index its best single-day percentage gain in 10 years. Amazon had its biggest gain in more than a year. The S&P 500 was up by a similar amount and the Nasdaq composite index was up even more - 5.8 percent. Eastern Time. The Dow Jones Industrial Average climbed 731 points, or 3.4 percent, to 22,524.

The tech-heavy Nasdaq added 25.14 points, or 0.4 percent, to 6,579.49.


The Dow finished Monday 18.9 per cent lower than its closing high, not far off from joining the Nasdaq, the Dow Jones Transport Average and small-cap Russell 2000 index in bear market territory. The swing was indicative of the volatility that has gripped the stock market throughout December. By the close, the Dow, S&P 500 and Nasdaq had notched their largest daily percentage gains in almost a decade.

Until Wednesday, the holiday season had been a big disappointment for investors and traders, with most of the losses coming in the previous four trading days.

The partial USA government shutdown that started Saturday is unlikely to hurt the economy much, although it may deprive the financial markets of data about global trade and gross domestic product. -China trade dispute and higher interest rates would slow the economy, hurting corporate profits.

Technology companies, a big driver of the market's gains before the October downturn, slumped Thursday. Shares of Chevron dropped 1.6 percent.


Bond prices fell. The yield on the 10-year Treasury is up to 2.76 percent.

The pickup in oil prices helped boost energy stocks. The German DAX slid 2.4 percent, while the Nikkei 225 index rebounded 3.9 percent.

Thin trading and a lack of big news often send stocks higher in the last week of December. Brent crude, used to price worldwide oils, gained 92 cents to $53.65 per barrel in London.

The dollar fell to 110.81 yen from 111.36 yen on Wednesday. The euro weakened to $1.1351 from $1.1404.


"The markets are in panic mode that the USA economy is tanking", Stephen Innes, head of Asia-Pacific trading for online broker Oanda, said in an email. The Standard & Poor's 500 rose 0.9 per cent to 2,488.83 after being down 2.8 per cent at midday.

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