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Stock Market Today: Dow in Strong Start to October as Bets on Fed Pivot Rise

Stock Markets Oct 03, 2022 04:07PM ET
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By Yasin Ebrahim

Investing.com -- The Dow rallied Monday, making a strong start to the final quarter of the year, as investors piled into tech and energy stocks on hopes that signs of slowing economic growth will force the Federal Reserve to cool the pace of rate hikes.

The Dow Jones Industrial Average gained 2.7%, or 765 points, the Nasdaq was up 2.3% and the S&P 500 rose 2.5%.

A duo of weaker-than-expected economic reports showing manufacturing activity unexpectedly slipped into contraction, and construction activity was worse than feared, stoked optimism somewhat that the Fed may be forced to consider a pivot to avoid pushing the economy into a deep recession.

ISM manufacturing data  for September showed a drop to 50.9 from 52.8, well below economists’ forecasts for a drop to 52.2. A reading above 50 in the ISM index indicates an expansion in manufacturing, which accounts for about 12% of the U.S. economy.

The odds of the Fed delivering its fourth-consecutive 75-basis-point rate hike fell to 59% from 72% a week ago, according to Investing.com’s Fed Rate Monitor Tool.

Treasury yields fell sharply as investors priced in the prospect of a less hawkish path of monetary policy tightening.

The 10-year Treasury yield fell from more-than-a-decade highs, with further easing likely ahead as it “remains very overbought on a short-term basis,” Janney Montgomery Scott said in a note.  

Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOGL) rose more than 3%.

Peloton Interactive (NASDAQ:PTON), meanwhile, announced an agreement to supply Hilton-branded hotels in the U.S with its fitness bikes, as CEO Barry McCarthy ramps up efforts to turn around the fortunes of the connected fitness-equipment company. Its shares were up about 7%.

Energy, up about 4%, also did some of the heavy lifting in the broader market melt-up on media reports that OPEC and its allies, known as OPEC+, are mulling slashing output by more than 1 million barrels per day ahead of Wednesday’s meeting.

Marathon Oil (NYSE:MRO) was up more nearly 11%, while Devon Energy Corporation (NYSE:DVN) and APA Corporation (NASDAQ:APA) were up more than 8% and 9%, respectively.

Tesla (NASDAQ:TSLA), meanwhile, slumped 8% after reporting that it delivered 343,000 vehicles in the third quarter, missing Wall Street estimates of between 358,000 and 371,000 vehicles.

Following the announcement, JPMorgan said it remained wary of Tesla’s valuation and continued to “see large downside to our price target [of $153],” suggesting about 37% downside from Tesla's current price. 

Stock Market Today: Dow in Strong Start to October as Bets on Fed Pivot Rise
 

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Comments (28)
S K
S K Oct 04, 2022 3:24AM ET
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Anyways guys the stocks are going up for a while. BUT ONLY for a while.
Bill Windle
Bill Windle Oct 03, 2022 9:07PM ET
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And the Trap is Set
Xerix 15
Xerix 15 Oct 03, 2022 9:07PM ET
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ye it will go brrrr
Darren Hunt
Darren Hunt Oct 03, 2022 8:49PM ET
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INVESTING.COM YOU HA E A SPAM PROBLEM
Gek Poh
Gek Poh Oct 03, 2022 8:49PM ET
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azql
Joel Schwartz
Joel Schwartz Oct 03, 2022 8:39PM ET
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WHY WOULD THE FED PIVOT WHEN WE ARE STILL OPERATING AT 300% THEIR INFLATION TARGET
Stephen Fa
Stephen Fa Oct 03, 2022 8:39PM ET
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They shouldn't until there is a clear CPI, PPI, PCE, down trend or unemployment raises dramatically. The economy will slow down and inflation cool if demand for money supply slows more. Government spending creates demand for $USD.
John Hill
John Hill Oct 03, 2022 8:39PM ET
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Writers perk the markets with such nonsense.
calvin tran
calvin tran Oct 03, 2022 8:39PM ET
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fed dont want to lose their jobs thats y
EKL Teo
EKL Teo Oct 03, 2022 8:03PM ET
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whatever they say for the rise and drop.
Jose Cabreja
Jose Cabreja Oct 03, 2022 7:44PM ET
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the FED pivot narrative 🤣🤣
Ac Tektrader
Ac Tektrader Oct 03, 2022 7:07PM ET
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Jennifer the spam queen
Chad Richer Than You
Chad Richer Than You Oct 03, 2022 6:55PM ET
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Next, I'm hiring "Buy And Sell" a janitor for the best pay of his lifetime!
Ac Tektrader
Ac Tektrader Oct 03, 2022 6:50PM ET
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looks like we have a lot of losers that shouldn't be trading this kind of market.
Ac Tektrader
Ac Tektrader Oct 03, 2022 6:47PM ET
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Mitchel has become the biggest joke of https://investing.com
 
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