Dow Jones jumps 825 points, stocks up Fed concerns about rising interest rates

The Dow Jones Index Closed on Tuesday (4 October) continued to rise, most recently rising 825 points, with stocks rising in all groups. As investors eased concerns about a Federal Reserve (Fed) rate hike after the United States released weak economic data.

The Dow Jones Industrial Average rose 825.43 points, or 2.8%, to 30,316.32, the S&P 500 rose 112.5, or 3.06%, to 3,790.93, and the Nasdaq gained 360.97, or 3.34,1%, to 614.

The devaluation of the dollar was driving trading. After investors worried earlier that the appreciation of the dollar will affect the profits of listed companies with foreign income.

In addition, the market also received positive factors from the decline in US government bond yields. The 10-year US Treasury Bond is a reference to the price of corporate bonds around the world. This includes the US mortgage interest rate. A rise in government bond yields would make consumers have less money to spend

while the cost of paying off mortgage loans increases AND companies will face higher costs of paying off debts. causing the company to reduce investment and reduce dividend payments to investors

At the same time, investors lowered their expectations that the Fed will raise interest rates 0.75% at its monetary policy meeting in November. after releasing weak economic numbers

The CME Group’s FedWatch Tool indicates that investors weigh 58.5% that the Fed will raise interest rates by 0.75% to 3.75-4.00% at its November 1-2 meeting, after previously weighing it up to 68.1%

Investors also raised their weighting to 41.5% on expectations that the Fed would raise interest rates by 0.50% at the meeting.

Investors are easing concerns about faster Fed interest rate hikes. After the US revealed, the manufacturing index was the lowest in more than two years.

The Institute for Supply Management (ISM) said its manufacturing index fell to 50.9 in September, the lowest level in more than two years since May 2020. It was below analysts’ forecast of 52.3 from 52.8 in August.

The manufacturing index was hit by a contraction in new orders. This was the third contraction this year, while employment contracted for the fourth time.

Investors will be keeping an eye on the release of non-farm payroll numbers for September on Friday.

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