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Stock Market News for Mar 30, 2023

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Wall Street closed sharply higher on Wednesday, led by a tech rally as investors awaited key inflation reading due on Friday that will help them assess how long the Fed is going to continue hiking interest rates. All three major indexes ended in positive territory.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) gained 1% or 323.35 points to close at 32,717.60 points.

The S&P 500 rose 1.4% or 56.54 points to end at 4,027.81 points. Tech and real estate stocks were the biggest gainers.

The Technology Select Sector SPDR (XLK) jumped 2.1%, while the Real Estate Select Sector SPDR (XLRE) gained 2.4%. The Consumer Discretionary Sector SPDR (XLY) gained 1.9%. All 11 sectors of the benchmark index ended in positive territory.

The tech-heavy Nasdaq climbed 1.8% or 210.16 points to finish at 11,926.24 points.

The fear-gauge CBOE Volatility Index (VIX) was down 4.26% to 19.12. Advancers outnumbered decliners on the NYSE by a 3.86-to-1 ratio. On Nasdaq, a 2.15-to-1 ratio favored advancing issues. A total of 10.61 billion shares were traded on Wednesday, lower than the last 20-session average of 12.73 billion.

Investors Regain Confidence

Stocks ended slightly lower on Tuesday as investors worried that further rate hikes by the central bank could push the economy into a recession. However, market sentiments have been gradually improving over the past few sessions.

Investors are slowly getting back the lost confidence as fears of a liquidity crisis spilling over in the banking sector following the failure of Signature Bank and Silicon Valley Bank earlier this month seem to be calming down.

On Wednesday, markets opened higher as investors felt a lot more confident after Fed official last week assured that the banking sector wasn’t facing any liquidity crisis. Tech stocks once again rallied led by Micron Technology, Inc. ((MU - Free Report) ) after the company despite posting a decline in its third-quarter revenues gave a positive outlook for 2025, on hopes that artificial intelligence will boost sales.

Following this, shares of Micron Technologies jumped 7.2%. Big tech also benefited from this, with shares of Apple, Inc. ((AAPL - Free Report) ) increasing 2%. Shares of Alphabet Inc. ((GOOGL - Free Report) ) rose 0.4%.

Financial stocks also continued their rebound with no major negative news from the banking sector. The SPDR S&P Regional Banking ETF (KRE), which tracks regional banks, increased by about 1%.

Shares of big banks like The Goldman Sachs Group, Inc. ((GS - Free Report) ) and Bank of America Corporation ((BAC - Free Report) ) also rose 0.8% and 2%, respectively. Bank of America has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

The tech stocks rallied primarily because treasury yields maintained a holding pattern ahead of the key Personal Consumption Expenditure (PCI) reading that is due on Friday. PCI came in at 5.4% in January, which was off its peak levels but quite above the Fed’s target level of 2%.

Friday’s fresh reading will help investors assess how many more rate hikes the Fed plans in the coming months.

Economic Data

In economic data released on Wednesday, the National Association of Realtors said that pending homes sales rose for the third straight month in February to 0.8%, its highest level since August.

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