London, Tuesday, 21 June 2022
US Markets Summary
As traders returned from a holiday weekend, U.S. stocks gained Tuesday, recouping some losses after the S&P 500's worst week since March 2020.
The S&P 500 rose 2.45 percent to 3,764.84 in its highest day in three weeks, recouping some losses after dropping 5.8 percent last week.
The Nasdaq Composite rose 2.5 percent to 11,069.30, while the Dow surged over 643 points, or 2.2 percent, to 30,531.77, its highest single-day gain since May 4.
Bitcoin (BTC-USD) climbed back above $21,000 over the weekend, after a cryptocurrency sell-off momentarily pushed prices below $18,000 for the first time since December 2020.
Treasury yields soared, with the benchmark 10-year yield reaching almost 3.3 percent, and U.S. crude oil prices climbed 1.5 percent to $111 per barrel.
After weeks of intense selling, Tuesday's early recovery bounce across risk markets provided at least a temporary respite.
Last week, the S&P 500 entered its first bear market since the outbreak's peak, and the sell-off accelerated after the Federal Reserve raised interest rates by a larger-than-usual 75 basis points and signalled it would be willing to tighten further, at the expense of some economic growth, to combat rising inflationary pressures.
On Wednesday and Thursday, Federal Reserve Chair Jerome Powell will deliver his semi-annual address to Congress, during which he is expected to be grilled by lawmakers on the Fed's efforts to lower inflation and the impact they may have on the economy.
Concerns about the economy's long-term viability have already risen substantially. Over the last few days, a number of analysts at big Wall Street firms have lowered their growth estimates to reflect the heightened possibility of a recession.
A recession is commonly defined as two consecutive quarters of negative GDP growth, though the National Bureau of Economic Research makes the final judgement (NBER).
European Markets Summary
On Tuesday, European equities rose for the third day in a row, with the STOXX 600 and DAX 40 indexes rising 0.4 percent and 0.2 percent, respectively, thanks to increases in commodities and consumer discretionary firms.
Taking advantage of cheaper valuations, investors have opened new positions. However, continuing fears that rising inflation and higher interest rates will push the bloc's economy into recession have stifled much of the rally's gains.
Meanwhile, in a disagreement over wages and conditions, the UK's greatest rail strike in 30 years begins today.
(Source: Yahoo! Finance and Trading Economics // Edited by: The Decision Maker – Finance editors)