Home Finance News Stocks rise as investors attempt to build on Friday’s rally

Stocks rise as investors attempt to build on Friday’s rally


A trader works on the trading floor at the New York Stock Exchange (NYSE), January 5, 2023.

Andrew Kelly | Reuters

Stock rose Monday as investors tried to build on a sharp rally from the previous session.

The Dow Jones Industrial Average ticked up 120 points, or 0.4%, while the S&P 500 and Nasdaq Composite added 0.7% and 1.4%, respectively.

That follows a winning week for the three major indexes, with the Dow and S&P 500 posting their best weeks since November. A chunk of those gains came Friday, with the Dow rallying 700 points, while the S&P 500 and Nasdaq advanced 2.3% and 2.6%, respectively. Those gains were spurred by the latest batch of economic data released Friday.

Nonfarm payrolls came in slightly higher than expectations, but wages increased at a slower pace than expected. That, and data showing a contraction in the services sector, heightened hopes that the central bank’s rate hikes are accomplishing the intended goal of cooling the economy.

That data helped investors shake off pessimism earlier in the week following the release of the December Fed meeting minutes, in which officials said interest rates would need to be elevated for “some time.”

“If last week was any indication, the factors that drove so much of 2022’s market action—inflation and the Fed’s response to it—will continue to exert their influence this year,” said Chris Larkin, managing director of trading at Morgan Stanley’s E-Trade. “The market’s day-to-day swings last week may symbolize a larger, longer-term tug-of-war that could play out this year.”

Investors will watch for consumer expectations and consumer credit data coming later in the day. They will also watch for December’s consumer price index report coming Thursday and big bank earnings scheduled for Friday.


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