Stock market today: Dow jumps 285 points as traders try to extend comeback from big sell-off
- US stocks rose on Wednesday as traders tried to extend Tuesday's rally in the wake of the latest sell-off.
- The Bank of Japan suggested it would pause rate hikes over the near term, bolstering investor sentiment.
US stocks jumped on Wednesday after the Bank of Japan issued guidance on interest rates and traders attempted to extend the rebound in stocks. All three benchmark indexes ticked higher, with the Dow surging over 300 points.
The deputy governor of the Bank of Japan said the central bank wouldn't hike rates amid heightened volatility in the market, easing investor concern over the carry trade unwind. A recent rate hike in Japan helped stoke the sell-off in global assets earlier this week, as traders previously borrowed cash at ultra-low interest rates in Japan to deploy elsewhere.
"Today's announcement from BOJ about a halt on rate increases suggests the damage from the unwinding of the carry trade still needs to play out, as [it's] possible many hedge funds, etc. still remain offsides," John Lynch, the chief investment officer at Comercia Wealth Management, said, though he noted that the firm still expected "further volatility" in stocks.
Investors are also eyeing whether the rally in stocks has staying power after the steep slide in indexes through Monday.
"With the VIX being as elevated as it is, we don't think investors need to rush to put new money to work right now," Michael Landsberg, the chief investment office of Landsberg Bennett Private Wealth Management said in a note. "We would avoid tech and industrials while this correction and heightened volatility is going on."
Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Wednesday:
- S&P 500: 5,312.98, up 1.39%
- Dow Jones Industrial Average: 39,273.45, up 0.71% (+285.74 points)
- Nasdaq composite: 16,672.80, up 1.88%
Here's what else is going on today:
- The S&P 500 falling 5% has historically been a good buy-the-dip opportunity, according to Goldman Sachs.
- New York City's transit system will get a boost from bonds backed by taxes on mansions.
In commodities, bonds, and crypto:
- West Texas Intermediate crude oil climbed 1.98% to $74.65 a barrel. Brent crude, the international benchmark, rose 1.82% to $77.87 a barrel.
- Gold was ticked higher 0.51% to $2,401.80 per ounce.
- The 10-year Treasury yield climbed 5 basis points to 3.942%.
- Bitcoin rose 2.2% at $57,284.