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Stock Market News For Oct 10, 2019

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Benchmarks closed higher on Wednesday after reports of at least a partial U.S.-China trade deal boosted investor’s sentiment before high-level negotiations begin on Thursday. Investors also kept a close eye on Fed’s September meeting minutes, as expectations for further rate cuts have risen recently.

The Dow Jones Industrial Average (DJI) rose 0.7% or 181.97 points to close at 26,346.01. The S&P 500 gained 0.9% or 26.34 points to close at 2,919.40. The Nasdaq Composite Index closed at 7,903.74 gaining 1% or 79.96 points. The fear-gauge CBOE Volatility Index (VIX) decreased 8.8% to close at 18.64. Advancers outnumbered decliner issues on the NYSE by a 1.95-to-1 ratio. On Nasdaq, a 1.60-to-1 ratio favored advancers issues.

How Did the Benchmarks Perform?

All 11 sectors of the S&P 500 closed higher. The largest gain was seen in the technology and energy sector that added 1.5% and 0.9%, respectively. Gain in the trade-sensitive chipmakers pushed the Philadelphia SE Semiconductor index to rise 1.7%.

Overall the Wednesday’s gain ended the two-day fall for all the major indexes. But the Dow remains 0.8% down on the week and the S&P 500 and the Nasdaq has fallen 15 and 0.9%, respectively.  The S&P 500 posted 12 new 52-week highs and 11 new lows, while the Nasdaq Composite recorded 10 new highs and 120 new lows.

Market Rises on Partial Deal Hope

After two days of consecutive losses the market recovered on Wednesday as report from various sources infused positive vibes on the trade front. Per a Bloomberg News, China was open to a limited tariff resolution with the United States, giving way to a partial deal even after America blacklisted 28 Chinese companies this week.

Another report from the Financial Times said that China had offered to increase purchase of agricultural products from U.S. farmers by 50%. Both the reports infused hope in investors, leading to the rise in all major benchmarks, while a significant rise was witnessed by trade-sensitive stocks.

Microsoft Corporation’s (MSFT - Free Report) shares rose 1.9% and that led the Dow’s gain. Microsoft carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

FOMC’s September Meeting Minutes

Federal Open Market Committee’s (FOMC) Sep 17 and 18 meeting minutes released on Wednesday indicated that Fed officials are concerned about the U.S. economy. In fact, Fed officials were split over the proper path of the monetary policy, while some were arguing that the chances of recession “had increased notably in recent months”, others believed that Fed should not have cut rates in September.

Following the disappointing economic data on manufacturing, service sector and  job openings in the last month, investors are now expecting that there will be a third rate cut at the FOMC’s Oct 30 and 31meeting.

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