Strong Rise in US Stock Market – Leading indices up nearly 2 percent

Strong Rise in US Stock Market - Leading indices up nearly 2 percent

For the second day in a row, Wall Street is expected to rise. This comes after two weeks of nearly continuous declines, for a total of ten percent, and with the worst of the year for the S&P 500 and many other indicators.

The rally on Wednesday evening was broad-based, covering all three major stock exchange indices and the vast majority of sector indices. This is how the exchanges ended on Wednesday:

  • The broad S&P 500 index rose 2.0 percent.
  • The Dow Jones Industrial Average rose 1.9 percent.
  • The Nasdaq Technology Index rose 2.1 percent.

Trading opened Wednesday afternoon with somewhat hesitation, but throughout the afternoon and evening all stocks were pointing straight up.

But the tech giant Apple opposed the influx and fell more than three percent at the opening, before the share stabilized somewhat. The reason was a message from the company that plans to increase production of new iPhones were postponed due to failed demand. It must be said here that many analysts are skeptical of this announcement, skeptical that the motive is to keep prices high. Apple shares closed down 1.3 percent on Wednesday.

English patient

At first, it was clear that investors were at a loss as to how to explain the financial crisis in Great Britain and the Bank of England’s intervention in the bond market. The British Central Bank on Wednesday took the step of buying long-term government bonds after the 30-year interest rate rose above five percent for the first time in two decades. Suddenly high and unstable interest rates in recent days have led British banks to stop all new mortgages with immediate effect. At the same time as interest rates rose, the British pound fell to historic lows against the dollar and other major currencies.

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The new government of Liz Truss, and in particular Finance Minister Kwasi Quarting, received much of the blame for the crisis after they put forward an economic plan with deep tax cuts at the weekend. In addition to the International Monetary Fund, among other things, becoming a filler in the markets, this week it went with something unusual as an apparent criticism of the British government’s tax cuts.

But the Bank of England’s intervention on Wednesday also eased pressure on US government revenues, and they eased somewhat.

On Wall Street, it only took an hour to digest the Bank of England’s attempt to put together a bailout, because after the worst fears had subsided, the vast majority of investors now decided it did.

But major investors and economists believe we haven’t seen the worst yet, and the US is headed straight into a recession.

– Our main argument is a hard landing by the end of 2023. I would be surprised if we didn’t see a recession in 2023, Stanley Druckenmiller, legendary American investor and hedge fund manager, told CNBC Wednesday night.

A recession means an economic decline, as measured by gross national product, for two consecutive quarters.(Conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links that lead directly to our pages. All or part of the Content may not be copied or otherwise used with written permission or as permitted by law. For additional terms look here.

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Dalila Awolowo

Dalila Awolowo

"Explorer. Unapologetic entrepreneur. Alcohol fanatic. Certified writer. Wannabe tv evangelist. Twitter fanatic. Student. Web scholar. Travel buff."

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