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Dow Jones Rebounds 1100 Points From Session Lows To Close Higher

Published 02/06/2018, 04:00 PM
© Reuters.
- – Wall Street closed sharply higher Tuesday as investors returned to take advantage of cheaper stocks following Monday’s steep selloff while signs of progress toward a budget deal eased uncertainty.

The Dow Jones Industrial Average closed higher at 24,914.49. The S&P 500 closed 1.75% higher, while the Nasdaq Composite closed at 7115.88, up 2.13%. The Dow Jones fell to an intraday low of 23,784 before staging a remarkable 1,100 move upside to end the day 550 points higher.

“Senate Democratic leader Schumer and I had a good meeting this morning about a caps deal and the other issues we’ve been discussing for some months now, Senate Republican leader Mitch McConnell told reporters.” “I‘m optimistic that very soon we’ll be able to reach an agreement.”

Signs of progress toward a budget deal come just two days before a stop-gap government funding measure – passed in January - is due to expire.

Tech led the move higher after Facebook (NASDAQ:FB), Google (NASDAQ:GOOGL), Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) caught a bid as fears of a prolonged selloff appear to have faded with the so-called fear index CBOE Volatility Index slumping more than 20%.

Also adding to positive sentiment on equities were reports that president Donald Trump is poised to unveil his infrastructure plan on Monday which aims to generate at least $1.5 trillion in investments.

In the wake of the selloff Monday, Goldman Sachs said it would retain its year-end forecast for the Standard & Poor's 500 of 2,850 as selloff was "technical and positioning-driven rather than fundamentally-based."

"We believe the fundamental drivers of the equity market remain intact," Goldman Sachs said in a note. "We continue to expect that earnings growth of 14%, including a 5% boost from tax reform, will lift equity prices this year."

'Bulls and Bears' on Wall Street

The top Dow gainers for the session: DowDuPont Inc (NYSE:DWDP) rose 6%, Home Depot Inc (NYSE:HD) rose 4.3%, Apple Inc (NASDAQ:AAPL) up 4.2%.

Exxon Mobil Corporation (NYSE:XOM) down 1.7%, Merck & Company Inc (NYSE:MRK) down 1.7%, and Coca-Cola Company (NYSE:KO) down 0.5%, were among the worst Dow performers of the session

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