Dow Surges 1000+ Points, Largest Single-Day Gain Ever

Dow Surges 1000+ Points, Largest Single-Day Gain Ever

The Dow soared more than 1,000 points - its biggest one-day point spike ever - for a gain of more than 4%, to 22,813.56, while the S&P 500-stock index rose almost 3 percent and the tech-heavy Nasdaq jumped 4 percent.

Investors returned from the Christmas holiday break in a buying mood Wednesday, sending USA stocks sharply higher and placing the market on track for its best day in nine months.

Retail stocks were bolstered by reports that Mastercard Inc (NYSE:MA) reported USA retail sales were the strongest in six years from November 1 to December 24.

On Monday, stocks slid an additional 2 to 3 percent after another Trump tweet-attack on the Fed and an effort by his Treasury secretary to calm investors' fears that only seemed to make matters worse.

Mnuchin tweeted on Saturday that he spoke with the President, relaying that Trump said, "I never suggested firing Chairman Jay Powell, nor do I believe I have the right to do so".

While no longer in bear market territory, it is still the worst December for United States markets since the height of the Great Depression in 1931.

The dollar rose and US equity futures advanced Wednesday after a volatile start as investors assessed the comments.

Monday's sell-off, which had both the Dow and S&P 500 flirting with bear territory, followed a weird Sunday night tweet from Treasury Secretary Steve Mnuchin in which he said he called the chief executives of the six largest banks in the USA and was assured they have "ample liquidity". Their 9.2 percent slump in the past four sessions was the steepest among the 11 major S&P sectors, while the S&P 500 tumbled 7.7 percent.

The S&P CoreLogic Case-Shiller 20-city home price index rose 5 percent from a year earlier, down from an annual gain of 5.2 percent in September.

US crude oil prices soared over 8%, helping oil stocks rise. On Tuesday, Trump reiterated his view that the Federal Reserve is raising interest rates too fast, but called the independent agency's rate hikes a "form of safety" for an economy doing well.

While he still criticized the Federal Reserve for raising interest rates too quickly, he said policy makers should "get it pretty soon", helping to soften market concern that he may try to fire Fed Chairman Jerome Powell. "If the U.S. economy turns south, global capital markets are in for a world of hurt".

"The market is trying to find an equilibrium between earnings, revenue growth and the economy, but when you have an onslaught of headlines that just manifest uncertainty from Washington, it just feeds negative sentiment", Krosby said. The slightest bit of bad news can turn a rally into a rout.

Technology stocks accounted for much of Monday's early bounce. Payment processors Visa and Mastercard also headed higher.

Big retailers were among the gainers. The Shanghai Composite Index ended 0.9 percent lower to 2,504.82. Nordstrom picked up 4.4 per cent to $46.13. PulteGroup climbed 1.1 per cent to $24.96.

Bond prices fell. The yield on the 10-year Treasury is up to 2.76 percent.

The dollar strengthened to 110.98 yen from 110.41 yen on Monday.

The Labor Department will report jobs figures on January 4, and companies will start reporting their fourth-quarter earnings soon thereafter. Kohl's jumped 5.6 percent.

The partial USA government shutdown that started Saturday is unlikely to hurt the economy much, although it may deprive the financial markets of data about global trade and gross domestic product.

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