Final hours! Save up to 55% OFF InvestingProCLAIM SALE

S&P 500 in Best Week Since November After Brushing Off Calls for Fed to Do More

Published 03/19/2022, 04:28 AM
© Reuters.
US500
-
DJI
-
MSFT
-
FDX
-
GOOGL
-
AAPL
-
AMZN
-
NVDA
-
GME
-
LHX
-
IXIC
-
HII
-
META
-
GOOG
-

By Yasin Ebrahim

Investing.com -- The S&P 500 rallied Friday to post its best week since November, led by tech as the broader market shrugged off Federal Reserve officials calling on the central bank to get even more aggressive on rate hikes that many fear could slow the economy too much.

The S&P 500 rose 1.1%, the Dow Jones Industrial Average gained 0.8%, or 273 points, the Nasdaq rose 2.1%.

Tech continued its comeback to remain on course to snap a two-week losing streak as investors continued to pile into big tech.

Meta Platforms (NASDAQ:FB) led the pack up more than 4%, followed by Amazon (NASDAQ:AMZN), and Apple Inc (NASDAQ:AAPL) up more than 2%, while Alphabet (NASDAQ:GOOGL) and Microsoft (NASDAQ:MSFT), were up more than 1% each.

Chip stocks were also in the ascendency, supported by a more than 6% gain in Nvidia (NASDAQ:NVDA) as the chipmaker extended its rally for a fourth straight day.

Growth sectors of the market like tech were also helped by falling interest rates even as Fed officials urged the central bank to do even more.

Federal Reserve Governor Christopher Waller on Friday called on the Fed to consider more aggressive rate hikes and get balance sheet reduction underway to make a dent in the pace of the inflation.

The remarks arrived on the heels of remarks from St. Louis Fed President James Bullard, who suggested the Fed hike rates by 50 basis points several times this year to push the central bank’s benchmark rate to 3% by year end.

That would be well above the Fed’s current outlook for rates to reach about 1.9% by year end.

Industrials struggled to join in on the broader market rally pressured by weakness in defense stocks and a slump in FedEx.

FedEx (NYSE:FDX) fell 4% after reporting quarterly results that missed both the top and bottom lines as higher labor costs hurt results.

Defense stocks including Huntington Ingalls Industries (NYSE:HII) and L3Harris Technologies Inc (NYSE:LHX) ended in the red as investors appeared to be pricing in the prospect of progress on Ukraine-Russia peace talks that could prove key to ending the war.

On the geopolitical front, President Joe Biden warned Chinese President Xi Jinping of "consequences" should Beijing support Russia's invasion of Ukraine, Bloomberg reported. 

In other news, GameStop (NYSE:GME) ended the day more than 3% higher despite delivering a surprise fourth quarter loss.

Stocks were expected to have a volatile end to the week as triple witching -- when stock options, stock index futures, and index option contracts expire on the same day -- usually triggers wild moves as investors move out of old positions and take new ones.

The rally in the broader market has stoked debate on whether this is the start of a bottoming process, or further downside lies ahead.

Market technicians, however, urge caution on reading too much into the rally as options expiry tends to muddy market movements. Technical indicators including volume and market breadth have yet to improve significantly to signal that the market is establishing a bottom.

“If this is the beginning of something more broad based, you’d want market breadth conditions to improve meaningfully … volume being strong as the price is going higher, but I think the jury's still out on that,"  Chief Market Strategist David Keller at StockCharts told Investing.com in an interview on Friday.

“At at this point, I'm still thinking of it as a tradable bounce within a downtrend.” Keller added.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.