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Stock Market News for Sep 16, 2021

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U.S. stocks finally bounced back to close higher on Wednesday, aided by a rally in energy stocks and some positive economic data. However, investors are looking forward to Fed’s meeting on monetary policy plans next week. All the three major indexes ended in positive territory.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) gained 0.7% or 236.82 points to finish at 34,814.39 points.

The S&P 500 climbed 0.9% or 37.65 points to end at 4,480.70 points. Energy, financials and industrial stocks were the best performers.

The Energy Select Sector SPDR (XLE) jumped 3.7%, while the Industrials Select Sector SPDR (XLI) gained 1.1%. Financials Select Sector SPDR (XLF) advanced 1%. Ten of the 11 sectors of the benchmark index closed in positive territory.

Shares of Exxon Mobil Corporation (XOM - Free Report) gained 3.4%. Exxon Mobil carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

The tech-heavy Nasdaq rose 0.8% or 123.77 points to close at 15,161.53 points, snapping its five-day losing streak.

The fear-gauge CBOE Volatility Index (VIX) was down 6.58% to 18.18. Advancers outnumbered decliners on the NYSE by a 2.15-to-1 ratio. On Nasdaq, a 1.70-to-1 ratio favored advancing issues.

Energy Stocks Help Markets

Markets bounced back on Wednesday despite expectations that trading sessions would remain choppy at least till investors get a clear picture about the government’s monetary policy plans in next week’s Federal Open Market Committee’s meeting. However, energy, financial and industrials, which were the worst performers on Tuesday, bounced back from the lows to drive Wednesday’s rally.

This was primarily because of a series of positive economic data. Energy and industrial stocks are linked to economic recovery, which rallied after investors’ confidence got a boost from the positive economic data.

September is historically a bad month for U.S. stock market and this year has been no different, with the Dow down 1.6% this month through Wednesday. This also makes it the worst first 10 days in September for markets in the past decade.

Financial stocks also jumped, helped by rising U.S. Treasury yields. Higher interest rates mean higher profits, which sent bank stocks on a rally.

Economic Data

In economic data released on Wednesday, the Fed Reserve said that industrial production grew 0.4% in August, slightly below economist’s expectations of a 0.5% rise but it was enough to lift investors’ sentiment. Also, capacity utilization increased 0.2% in August.

Separately, the New York Fed’s Empire State business conditions index rose 16 points to 34.3 in September, according to the Fed. Analysts had expected a reading of 17.2.

The government also said that import price index declined 0.3% in August, its first decline in 10 months. The decline was primarily because of lower cost of industrial supplies and foreign oil.

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