U.S. stocks held on to slight gains on Monday, recouping some of the losses incurred during Wall Street’s worst week of 2023, as some investors dismissed recent hot inflation data.How stocks traded
The Dow Jones Industrial Average
finished up 72.17 points, or 0.2%, at 32,889.09 after briefly dipping into the red during the final 30 minutes of trading.
The S&P 500
ended up by 12.20 points, or 0.3%, at 3,982.24.
closed 72.04 points, or 0.6%, higher to end at 11,466.98.
Stock indexes booked their biggest losses of 2023 last week. The Dow dropped 3% for its biggest weekly decline since the week that ended Sept. 23. The S&P 500 retreated 2.7% for its third straight weekly fall and the Nasdaq fell 3.3%. The S&P 500 and Nasdaq saw their biggest weekly declines since the week ending Dec. 9.
What drove markets U.S. stocks gained back some of the ground they lost last week, when equities fell on further signs that relatively robust economic activity is helping keep inflation stubbornly high. The PCE inflation measure released on Friday showed price pressures remain elevated, reducing the chances that the Federal Reserve will consider easing monetary policy anytime soon and thus forcing bond yields higher. Fed Gov. Philip Jefferson said on Monday that he doesn’t support raising the central bank’s 2% inflation target because it “would damage the central bank’s credibility.” Some investors brushed aside the PCE report. Jay Hatfield, chief executive of Infrastructure Capital Advisors in New York and portfolio manager of the InfraCap Equity Income ETF
said he thinks the PCE and U.S. consumer-price index are “overstating inflation.” In particular, he said, PCE contains a number of volatile components such as transportation services “which can reverse month to month and show significant declines.” “We do not believe that the Fed will double down on rate hikes and do 50bp [basis points] at the next meeting,” Hatfield wrote in an email to MarketWatch. “We continue to believe that the Fed is far too bearish about inflation.”In Monday’s final half-hour of trading, Dow industrials intermittently saw gains evaporate as traders continued to weigh the prospects of hig …