(News Bulletin 247) – The New York Stock Exchange opened higher on Monday morning, erasing some of the heavy losses suffered last week, due to inflation figures that came out well above expectations.

One hour after the opening, the Dow Jones resumed 0.8% to 33,076.5 points, while the Nasdaq Composite recovered by more than 0.9% to 11,501.8 points.

The broader S&P 500 index rose for its part by 0.7% to 3997 points.

Wall Street is emerging from a week of high volatility, in which the two indices both lost more than 3% last week, their steepest weekly decline since the start of the year.

Some strategists believe that the market has entered a phase of consolidation justified by the ‘overbought’ nature of equities and by technical indicators which had become very tense.

‘The S&P 500 remains above its 200-day moving average, but a drop in this threshold would see the index quickly rally to the 3850-3900 point zone, or even the 3800 point level’, warns a trader.

But the rebound that started on Monday suggests that market participants continue to view any pullback as an opportunity to gain strength and not miss the potential upside train (FOMO).

The rebound at the start of the week was notably driven by a few cheap takeovers of industrial stocks, which had one of the worst performances last week.

The recovery is also favored by a slight improvement in bond yields, with a 10-year paper rate easing towards 3.91%, far from the three and a half month highs reached last week.

Another reassuring element, the CBOE index fell back by more than 2%, the fear index returning to its lowest level in almost a week.

In terms of the economy, durable goods orders fell 4.5% in January, after rising 5.1% in December, a much sharper decline than expected.

Excluding transportation equipment, orders for which plunged 13.3% month-on-month, US durable goods orders still posted an increase of 0.7% in January.

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