S&P and Dow Extend Winning Streak to Seven Days on Falling Treasury Yields

S&P and Dow continue to rise for seven straight trading days
Nasdaq climbs for the eighth consecutive trading day
Tech stocks soar as treasury yields fall
Remarks from Federal Reserve officials this week drew attention

The New York Stock Exchange recorded its longest rally in about two years, buoyed by falling treasury yields.

On the 7th (local time) at the NYSE, the Dow Jones Industrial Average closed up 56.74 points (0.17%) at 34,152.60. The S&P 500 Index rose 12.40 points (0.28%) to close at 4,378.38, and the tech-heavy Nasdaq Index finished up 121.08 points (0.90%) at 13,639.86.

The S&P 500 and Nasdaq indices have each risen for seven and eight consecutive trading days, respectively, for the first time since November 2021. The Dow also recorded its first seven-day winning streak since July.

Tech stocks rose as U.S. treasury yields fell. The 10-year treasury yield was recorded at 4.5690%, down about 9 basis points (1bp=0.01%p) from the previous trading day. Leading stocks included Amazon, which rose 2.13%. Apple and Salesforce each climbed 1.45% and 2.13%, respectively. Microsoft (MS) and Meta stocks also jumped about 1%. AMD (1.52%), Intel (2.16%), and Broadcom (1.93%) rose on news that the Biden administration would provide funding under the semiconductor support law (CHIPS Act).

Cloud monitoring and security company Datadog saw its stock price surge 28.47% after announcing third-quarter solid results and providing robust guidance. Despite Q3 results falling short of expectations, Uber’s stock rose 3.7%.

Mona Mahajan, an investment strategist at Edward Jones, told CNBC, “As treasury yields fall, growth stocks tend to see a bigger rebound,” adding that “the decline in oil prices could also affect inflation sentiment and somewhat ease investment psychology.”

Wall Street is keeping a close eye on whether the rally of the three major indices can continue. This month, the S&P 500 and Nasdaq indices have risen by 4.4% and 6.1% respectively. The Dow has also increased by 3.3%.

Additionally, the market is awaiting remarks from Federal Reserve officials, including Chairman Jerome Powell. Speeches from Federal Reserve Board Members Lisa Cook and Christopher Waller, Vice Chair Philip Jefferson, and New York Fed President John Williams are scheduled for this week.

According to CME FedWatch, U.S. federal funds rate futures traders estimated a 90.2% probability that the Federal Reserve will keep interest rates steady at the December Federal Open Market Committee (FOMC) regular meeting. The possibility of a 0.25 percentage point (p) rate hike at the December meeting was estimated at 9.8%.

By. Jeon Ah Hyun