Stock rose Monday after themajor averages notched their first big rally of the new trading year.
The Dow Jones Industrial Average ticked up 136 points, or 0.4%, while the S&P 500 and Nasdaq Composite added 0.6% and 0.8%, respectively.
All the major averages advanced last week, with the Dow and S&P 500 posting their best week since November. The Dow on Friday surged 700 points, or 2.13%, while the S&P 500 and Nasdaq Composite added 2.28% and 2.56%, respectively, after the December jobs report signaled that inflation may be easing.
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.
Harvey said 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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