U.S. stocks moved sharply higher on Monday, at or near session highs in late afternoon trade, as investors assessed weaker-than-expected economic data and the possibility that the Federal Reserve might pull back on aggressive rate increases by year-end.What’s happening
The Dow Jones Industrial Average
rose rose 483 points, or 1.6%, to 31,566.
The S&P 500
was up 48 points, or 1.3%, at 3,801.
The Nasdaq Composite
advanced 82 points, or 0.8%, to 10,941 after shaking off a morning decline.
The Dow rose 4.9% last week and the S&P 500 advanced almost 5% for their largest such gains since the week that ended June 24. The Nasdaq Composite gained 5.2% last week, its biggest rise since the week that ended July 29.
What’s driving markets Investors continued to react to Friday’s report in The Wall Street Journal, which said that the Federal Reserve is likely to use its November meeting to debate whether to trim the size of its rate hike in December. Fed policy makers are currently in a blackout period, with no fresh comments expected this week ahead of their two-day rate-setting meeting that ends on Nov. 2. Don’t miss: Stock market live coverage Meanwhile, Monday’s data batch brought a “meltdown” in the purchasing managers indexes for Europe and the U.S., where the readings were worse than expected, according to Jay Hatfield, chief executive of Infrastructure Capital Advisors in New York. That data, along with The Wall Street Journal article, were the reasons for the stock market’s continued rally “as investors become more optimistic that the Fed will back off from its ultra-hawkish policies,” he said via phone.“Our thesis is that the Fed is going to have to back off” or risk causing a global recession, Hatfield said. He noted that Monday’s stock rally was accompanied by a periodic rally in bonds on “expectations for a more dovish Fed.” Markets are also gearing up for a wave of earnings reports, including from tech giants Alphabet
this week. See: Stock-market investors brace for busiest week of earnings season. Here’s how it stacks up so far.The first full week of the earnings season ended on a s …