Wall Street ended a volatile third quarter with a split verdict: the S&P 500 and the Dow lost ground for the week even as the Nasdaq advanced. Cooler-than-expected inflation data eased Federal Reserve rate-hike bets, but rising crude prices and climbing Treasury yields kept some of that relief in check.
Stocks gyrated on Wednesday, caught between cooling price pressures and signs of a resilient economy, as investors closed the book on a tumultuous month and quarter.
S&P 500 and Nasdaq post quarterly gains, Dow lags
The S&P 500 and the Dow lost ground on the week, while the Nasdaq advanced. For the quarter, though, the picture flipped in the S&P 500's favor: the S&P 500 and the Nasdaq posted gains, but the Dow ended the July-September period lower.
Tech led the advance. Tech, communication services and software/services were clear outperformers, with megacaps led by Alphabet and Apple providing upside muscle, while European stocks logged their first monthly loss in six months.
Cooling inflation eases rate-hike bets
Cooler-than-expected inflation data tempered rate hike expectations from the Federal Reserve, while upbeat GDP, consumer spending and private payrolls data underscored US economic resilience. As a result, the dollar softened against a basket of world currencies as cool inflation data reduced rate hike bets.
Even so, the relief was only partial. Rising crude prices kept inflation jitters alive, even as long-dated Treasury yields kept climbing.
Treasury yields extend gains as oil and gold diverge
Bonds moved the other way: US Treasury yields notched a seventh straight day of gains to reach multi-year highs. Meanwhile, crude prices settled higher amid stalled US-Iran talks, and gold reversed earlier gains as higher energy prices eclipsed cool inflation data.
The S&P 500 carries its quarterly gain into October, but the week's pullback shows the rally still answers to every Treasury tick.
Source: Investing.com
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