Stocks rally ahead of the Fed’s meeting minutes

US stocks rallied in a back-and-forth session on Wednesday as Wall Street looked to recover from a pessimistic start to the week and the new year. Investors are weighing a batch of economic data and looking forward to the minutes of the Federal Reserve’s monetary policy meeting in December.

S&P 500 Index (^ The Salafist Group for Preaching and Combat(up 1.2% in afternoon trade, while the Dow Jones Industrial Average rose)^ DJI) jumped more than 200 points, or 0.7%. Nasdaq Technology Heavy Composite (^ ix) advanced 1.1%.

the most recent Employment Opportunities and Labor Turnover Survey, or JOLTS, Show 10.5 million vacancies in November – more than expected – indicating continued labor market momentum despite monetary tightening by the Federal Reserve. Meanwhile, the ISM Manufacturing PMI It fell for the second month in a row to 48.4 in December from 49 in November, the largest drop since May 2020.

The moves on Wednesday come after a bleak start to 2023 trading as many of the pressures of the past year follow investors into the new year. Tuesday, The three major averages closed lower.

All eyes were on Tesla (TSLA) again Wed post stock It fell 12% on the first trading day of 2023 Tuesday. It marked Tesla’s biggest drop in more than two years and erased all recovery gains made in the last three sessions of 2022 last week. Shares rose 4.5% on Wednesday.

The electric car maker earlier this week Vehicle production and delivery reported Fourth-quarter numbers disappointed Wall Street, adding to another woe for investors already weighing concerns about production at Tesla’s China factory and CEO Elon Musk’s management of Twitter.

Alibaba Group shares (Baba) rose 11.7% after billionaire co-founder Jack Ma It won the approval of Chinese regulators to raise 10.5 billion yuan — or $1.5 billion — for Ant Group’s consumer financing business. Other US-listed Chinese stocks also rose.

sales force (CRM) announced on Wednesday Restructuring plans that included cutting about 10% of its workforce and closing some of its offices, joining a growing list of tech companies laying off workers to cut costs after surging hiring during the post-pandemic boom in 2021. Shares rose 3.3%.

Elsewhere in other markets, US Treasury yields fell, with the benchmark 10-year note down 7 basis points to a yield of about 3.70%, while the two-year yield fell about 4 basis points to 4.37%.

The US dollar index also fell. And oil prices continued to fall, with West Texas Intermediate (WTI) crude futures – the US benchmark – down 4% below $74 a barrel.

NEW YORK - JANUARY 3: An exterior view of the New York Stock Exchange on Wall Street during the first trading day of 2023 at the New York Stock Exchange in New York City, January 3, 2023. (Photo by Kenna Betancourt/View Press)

NEW YORK – JANUARY 3: An exterior view of the New York Stock Exchange on Wall Street during the first trading day of 2023 at the New York Stock Exchange in New York City, January 3, 2023. (Photo by Kenna Betancourt/View Press)

Investors are in for a busy week of economic data Shorten the first trading week of the year. Minutes from the December FOMC meeting are due at 2 PM ET. The reading is likely to show the thinking behind the “slower but louder” central bank regime after Fed Chair Powell last month He and his colleagues pointed out They will turn out to be less price increases but potentially higher final rate of interest.

financial markets It capped its worst year since 2008 on Fridayaggression Central bank actions to suppress inflation The war in Eastern Europe devastated stocks and bonds. Even as investors turn the page in 2022, much of Wall Street You expect more pain in the future.

“What we picked out from our model is that there is some kind of systemic change happening beneath the surface, and what we mean by that is 2022 was all about the Federal Reserve where they tightened financial conditions to fight inflation,” Huw Roberts, head of analytics at Quant Insight, told Yahoo Finance Live on Tuesday.

“But what we’re picking up now, is more sensitivity to the real economy — greater sensitivity to growth, the inflation outlook, industrial metals, the credit cycle — and what that tells us is that markets are going to spend early 2023 really worried about a hard landing.”

Alexandra Semenova is a correspondent at Yahoo Finance. Follow her on Twitter @tweet

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