Stock market today: Stocks rally as oil prices crumble

Shares closed higher on Wednesday as bargain hunters swooped in after a long string of losses for major indices.

Today’s positive price action came as the 10-year Treasury yield retreated from yesterday’s two-month high to close 6.7 basis points at 3.273%. A basis point is one hundredth of a percentage point.

And buying continued even after Federal Reserve Vice Chairman Lael Brainard said in a speech earlier this afternoon that the central bank is “in it for as long as it takes to bring inflation down.” The Fed is set to meet later this month, with the market largely pricing in the likelihood of a third straight 75 basis point rate hike.

Almost all sectors finished higher, with Utilities (+3.1%) and consumer stocks (+3.1%) at the top. The only outlier was energywhich collapsed by 1.2% US Crude Oil Futures fell 5.7% to $81.94 a barrel — the lowest close since Jan. 11, according to Dow Jones Market Data — amid expectations of slowing global economic growth. “Today’s oil collapse is a major shot across the bow that we think bodes for more fighting,” said Dan Wantrobski, technical strategist and associate director of research at Janney Montgomery Scott. “We believe the commodity can drop below $80 from here and target the mid-$70s in the coming weeks.”

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As for the main indices, the Nasdaq Composite rose 2.1% to 11,791 – ending its seven-day losing streak, the longest since 2016 S&P 500 Index (+1.8% at 3,979) and the Dow Jones industry average (+1.4% at 31,581) also posted impressive gains.

More news on the stock market today:

  • The small cap Russell 2000 rose 2.2% to 1,832.
  • gold futures gained 0.7% to close at $1,727.80 an ounce.
  • Bitcoin surged as high as $19,183 before retreating to $19,011.19, up 1% from this point yesterday. (Bitcoin trades 24 hours a day; prices quoted here are as of 4:00 p.m.)
  • Twitter (TWTR) up 6.6% following a report in The Wall Street Journal said a Delaware judge ruled that Elon Musk could include whistleblower allegations against the social media company in his counterclaim. However, the judge denied Musk’s request to postpone the trial from its currently scheduled October 17 date to November. Twitter is suing Musk over his attempt to back out of a $44 billion deal to buy the company, while Tesla (TSLA) CEO has filed a counterclaim accusing TWTR of misrepresenting key metrics for its business. “While we believe whistleblower Musk’s comments give Musk some hope for the upcoming trial while adding some uncertainty, we believe it will ultimately be contentious and continue to see a strong likelihood that TWTR will prevail in court.” , says CFRA Research Analyst Angelo Zino (Hold). “We still believe the most likely outcome is a purchase of TWTR by Musk, either compelled by courts or settled at less than a 15% to 20% discount.”
  • Coupa software (COUP) rose 17.9% after the company, which offers cloud-based business spend management software, reported earnings. In the second quarter, COUP saw quarterly subscription revenue increase 23% year over year to a record $193 million, which helped increase total revenue by 18% to $211 million. The company also announced that its board of directors has approved a $100 million share repurchase program. UBS Global Research analyst Taylor MicGinnis called the results “solid” but maintained a neutral (hold) rating on the stock, citing a “more reasonable” rating at current levels amid “limited visibility over near-term growth.” in the high teens”.

Concentrate on the big picture

Uncertainty over the magnitude of the Federal Reserve’s next rate hike will keep markets busy until the next central bank monetary policy meeting, scheduled for June 20-21. September is planned to move further. That makes tomorrow’s Fed Chair Jerome Powell’s speech a key event to watch and one that could potentially trigger more volatility for stocks.

But savvy investors know that these short-term ups and downs are noise compared to the bigger picture. “In the end, the day-to-day machinations of the market matter only as much as we let them,” said Ross Mayfield, Baird’s investment strategy analyst. “Volatility and sell-offs — in all their various forms and degrees — are just one reality for the long-term stockholder to endure.”

Indeed, investors can use the bearish days to gradually add to their core portfolio holdings. Not sure where to start? How about these resilient blue-chip stocks, or a look at some of Wall Street’s top dividend payers? For investors wanting a broader approach, we recommend the Kip 25. This list of Kiplinger’s most popular low-cost mutual funds boasts solid long-term performance records and managers with tenures to match. Look at her.

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