Stock Market This Week (US): Why did Dow Jones jump 2% this week? Check out the key highlights
Stock Market This Week (US)
The US market had one of the best starts to the week in recent times. However, it gave away most of the gains but closed higher for the week. The Dow rose 2% for the week, while the S&P added 1.5%. The Nasdaq closed with a 0.7% gain.
US stock market this week: Stocks movement this week
The US stock market rallied on Monday to start the week and the quarter on a positive note. All major indices were up over 2% as they reported the best day since 24 June. The yield on the 10-year US Treasury note rolled over to trade at around 3.65%, after topping 4% at one point last week.
On Tuesday, the US stocks continued to rally, and bond yields continued to fall. At the close, it was the best two-day rally investors have seen since March 2020. Sentiment also got a boost as shares of Credit Suisse ended the day 12% higher.
The US market snapped a two-day rally on Wednesday as all major indices closed marginally lower for the day. The key news for the day was that Elon Musk agreed to purchase the social media platform at his original proposed price of $54.20 per share.
On Thursday, the US stocks continued to tumble as traders weighed sharp swings in stocks and rates. Despite the negative sentiments, Energy sector stocks performed well - the index closed 1.8% higher. The utility sector was the worst performing with a 3.3% fall.
The US stocks continued to fall for the third consecutive day on Friday. A sharp fall was seen after September's job report was out - the numbers did not look good. The falling unemployment rate sparked a jump in rates, in turn weighing on stocks.
US stock market this week: Major events
September Job report: Nonfarm payrolls increased by 263,000 for the month. However, it fell short of the Dow Jones estimate of 275,000. The unemployment rate was 3.5%, down 0.2 percentage points as the labor force participation rate edged lower. A more encompassing measure that includes discouraged workers and those holding part-time jobs for economic reasons saw an even sharper decline, to 6.7% from 7%.
Credit Suisse issue: The shares have fallen more than 50% since the start of the year. The bank is going through tough times - it had reported losses for the last three quarters. It is too big a bank to fall, and if it does, it may lead to the downfall of the world's banking ecosystem. To calm investors, the CEO announced that the bank has sufficient capital and liquidity and there is nothing to be worried about.
Musk-Twitter Deal: Elon Musk was back in the news this week. On October 4th, Musk filed a nice letter with the SEC saying that he did intend to do the Twitter deal, and he did intend to do it at $54.20 a share — just as long as the court proceedings stopped.
Treasury yield: On Friday, the two-year US Treasury yield, which typically moves in step with interest rate expectations, was up and stood at 4.314%. The yield on 10-year Treasury notes was up 7.8 basis points to 3.902%, while 30-year Treasury bond was at 3.859%.
Oil prices rally: Crude oil prices jumped more than 16% this week after OPEC+ agreed to reduce oil production by 2 million barrels a day, the first proposed target reduction since the Covid-19 pandemic. The decision by OPEC+ to slash production will boost the cost of oil given the weakening demand. US and Europe are already facing high energy costs after cutting Russian oil supplies amid Ukraine war.
What was the unemployment rate for September month?
The unemployment rate fell to 3.5% in September from 3.7% in the prior month.
Will Elon Musk purchase Twitter?
As of 4th October, Elon Musk has said that he is still interested in purchasing Twitter at $54.20 per share after calling off the deal earlier.
Which were the best-performing sectors this week?
Energy and Capital Goods were the top-performing sectors this week with 13.77% and 4.55% gains, respectively.
Why is crude oil price rising?
Crude oil prices jumped more than 16% this week after OPEC+ agreed to reduce oil production by 2 million barrels a day.