June 26, 2022

South Sudan News Agency

Complete English News World

Wall Street rises, cutting longest weekly losing streak in decades By Reuters

Wall Street rises, cutting longest weekly losing streak in decades By Reuters
© Reuters. FILE PHOTO: A sign for a Gap store on Fifth Avenue in Midtown Manhattan in New York on June 16, 2015. REUTERS/Brendan McDermid


Written by Stephen Kolb

NEW YORK (Reuters) – Wall Street closed sharply higher on Friday as indicators of rising inflation and consumer resilience pushed investors into a long weekend with growing optimism that the Federal Reserve would be able to tighten monetary policy without pushing the economy into a recession.

All three major US stock indexes put a decisive end to their longest losing streak in decades.

The S&P and Nasdaq suffered seven consecutive weekly declines, the longest since the end of the dotcom crash, while the Dow’s eight-week premium sell was the longest since 1932.

“The market has now pared down a lot of negative news, a lot of which hit at once,” said Keith Buchanan, portfolio manager at GLOBALT in Atlanta. “We have now absorbed that news and the actions that the Fed will take, and we are ending earnings season.”

“The signs are lined up and the funds we expect to develop are being checked when the market starts bottoming out,” Buchanan added.

During the seven consecutive weeks of losses for the S&P, from April 1 to May 20 on Friday, the leading index shed 14.2% of its value and threatened to confirm that it had been in a bear market since January 3, its highest close on record.

But this week, in a sharp reversal, the S&P regained much of those losses, rising 6.6%, its best week since November 2020.

See also  Lululemon (LULU) earnings for the first quarter of 2022 beat estimates

“It was inevitable that the losing streak would come to an end,” said Tim Gresky, senior portfolio strategist at Ingalls & Snyder in New York. Corrections and bear markets are followed by “bullish” markets.

Generally upbeat earnings guidance and strong economic indicators have raised hopes that the Fed’s tough maneuvers to contain decades of high inflation will not lull the economy into deflation.

Data released on Friday showed better-than-expected consumer spending and seemed to confirm that inflation, which has cut back on corporate earnings guidance and weighed on investor sentiment, has peaked.

This, along with the minutes of the central bank’s latest policy meeting, which reaffirmed its commitment to reining in high prices while still responding to economic data, helped boost risk appetite.

It rose 575.77 points, or 1.76%, to 33,212.96, increased 100.4 points, or 2.47%, to 4,158.24 points, and added 390.48 points, or 3.33%, to 12,131.13.

All 11 major sectors in the S&P 500 advanced in light trading, with consumer appreciation, technology and real estate posting the largest percentage gains.

Shares of Apple Inc (NASDAQ :), Microsoft Corporation (NASDAQ:) and Tesla (NASDAQ: Inc) made the strongest impact.

First-quarter earnings season is largely in the bag, with 488 companies in the S&P 500 reporting it. According to Refinitiv, 77% of those forecasts exceeded the consensus.

Ulta Beauty (NASDAQ: 12.5%) gained after its upbeat quarterly earnings report.

Computer hardware company Dell Technologies (NYSE: Inc) stock jumped 12.9% after beating earnings and quarterly revenue estimates.

Garment retailers Gap Inc (NYSE:) and American Eagle Outfitters (NYSE:) trimmed their annual earnings forecast. The latter fell 6.6%, while the former rebounded and closed up 4.3%.

See also  Indonesia bans palm oil exports as global food price inflation escalates

Volumes were light ahead of the long weekend, with US stock markets closed on Monday in observance of Memorial Day.

Volume on US stock exchanges reached 10.92 billion shares, compared to an average of 13.13 billion over the last 20 trading days.

Advance issues outnumbered declining issues on the New York Stock Exchange by 6.49 to 1; On Nasdaq, the ratio was 4.13 to 1 in favor of advanced traders.

The S&P 500 posted 3 new highs in 52 weeks and 29 new lows; The Nasdaq made 40 new highs and 84 new lows.