Nasdaq paces post-holiday rally
The market got off to a shaky start on Tuesday but recovered after finding support above lows from the previous week. The Tuesday bounce opened the door to an extension of the rebound over the coming days with sectors like communication services, consumer discretionary, and technology leading the market higher. The three groups gained a respective 4.9%, 4.6%, and 4.3%, distancing themselves from their mid-June lows.
Looking deeper in the tech sector, chipmakers were among the best performers with heavyweights like AMD and NVIDIA rising off their lowest levels in at least a year while the PHLX Semiconductor Index gained 6.5%, narrowing its year-to-date loss to 33.7%.
Crude oil faced pressure at the start of the week, falling past the $100.00/bbl mark to a level not seen since late April. Concerns about global growth fueled the selling on Monday and Tuesday, in turn emboldening the advance in the equity market. However, the next two days saw a bounce that lifted the energy component back above $100. WTI crude ended the week at $105.06/bbl, down $3.41 or 3.1% since last Friday.
The shortened week featured the release of the June FOMC Minutes, in which policymakers acknowledged the risk for a slowdown in growth from tighter policy and a concern that higher inflation could become entrenched if the public begins questioning the Fed's resolve. Policymakers agreed that moving to a restrictive policy stance is appropriate.
Treasuries gave back the bulk of their gains from the week before, lifting the 10-yr yield back above its 50-day moving average (3.003%). The benchmark yield increased by 21 bps to 3.10% for the week while the 2-yr yield rose 29 bps to 3.12%, inverting the 2s10s spread once again.
The U.S. Dollar Index climbed nearly 1.8% during the past week, reaching a level not seen since October 2002. The bulk of the strength took place at the euro's expense amid ongoing concerns about the impact of high energy prices on the European economy.
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2022-140693 (Exp. 10/22)