[New York Stock Market] Big Tech Rebounds Leading Broad Gains... Nasdaq Up 2.59%

[Asia Economy New York=Special Correspondent Joselgina] Major indices of the U.S. New York stock market closed higher on the 29th (local time), a day before the last trading day of 2022, supported by a rebound in tech stocks and worsening employment data.

On this day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 33,220.80, up 345.09 points (1.05%) from the previous session. The S&P 500, which focuses on large-cap stocks, rose 66.06 points (1.75%) to 3,849.28, and the tech-heavy Nasdaq index closed at 10,478.09, up 264.80 points (2.59%).

[Image source=Reuters Yonhap News]

By sector, all 11 sectors of the S&P 500 rose. In particular, technology, communication, and consumer discretionary stocks led the rally with gains of over 2%.

Representative tech stock Tesla closed up 8.08%, recovering to the $120 per share level. Apple, which had recently been declining due to concerns over iPhone production disruptions from China, also rose 2.83%. Microsoft increased by 2.76%, Amazon by 2.88%, and Nvidia by 4.04%. Netflix closed up more than 5% after CFRA upgraded its investment rating from sell to buy.

Additionally, Southwest Airlines (+3.70%), which had been experiencing a decline due to a large-scale flight cancellation crisis, announced plans to resume normal operations from the 30th, successfully rebounding on this day. General Electric (GE) closed up 2.17% ahead of the planned spin-off of GE Healthcare Technology.

Investors on this day focused on the possibility of a last-minute rebound following recent declines as 2022 came to a close. There was confirmed bargain buying centered on stocks that had recently fallen sharply, such as big tech. With year-end trading volumes decreasing and limited upward momentum, the movements of leading stocks influenced overall investor sentiment. Louis Navellier, founder of Navellier & Associates, described the market movement on this day as "a condensed one-day version of the Santa rally."

The worsening labor data released on this day also had a positive effect on the stock market. According to the U.S. Department of Labor, initial jobless claims last week increased by 9,000 from the previous week to 225,000. Continuing claims, which represent those applying for unemployment benefits for at least two weeks, rose by 41,000 to 1.71 million, the highest level since early February.

These indicators are interpreted as signs that the overheated labor market is gradually cooling due to the Fed's aggressive tightening. In particular, expectations that the Federal Reserve's tightening could ease as the labor market slows spread, providing a positive factor for the stock market on this day. Jason Blackwell, Chief Investment Strategist at The Colony Group, said, "The market is appreciating the moderate increase in jobless claims." Larry Adam, Chief Investment Officer (CIO) at Raymond James, also commented, "The overheating of the labor market is easing somewhat," calling it "welcome news for the Fed."

In the New York bond market, Treasury yields fell amid growing concerns about an economic recession next year. The yield on the U.S. 10-year Treasury note dropped to 3.833%, hitting as low as 3.818% during the session. The dollar index, which measures the value of the dollar against six major currencies, fell 0.5% to below the 104 level.

The New York stock market now has one trading day left in 2022. If the three major indices close the year at current levels, it will mark the worst performance since the 2008 global financial crisis. Especially the Nasdaq, which is tech-heavy, has recorded the largest loss among the three indices this year, with a decline in the 30% range, as investors shunned growth stocks amid recession fears. Sam Stovall, Chief Investment Strategist at CFRA Research, predicted that a recession will materialize in 2023 but said, "The severity remains a question mark." Navellier forecasted, "Due to high uncertainties surrounding a soft landing, recession, and whether the Fed will pivot, uncertainties in the new year could increase."

International oil prices fell for the third consecutive trading day. On the New York Mercantile Exchange, the February WTI crude oil contract for next year closed at $78.40 per barrel, down $0.56 (0.71%) from the previous session. The reopening of overseas travel in China and concerns about a resurgence of COVID-19 in various countries were seen as factors contributing to the decline in oil prices.

This content was produced with the assistance of AI translation services.