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Dow jumps as bullish bets return ahead of Fed, inflation data By Investing.com


©Reuters.

By Yasin Ebrahim

Investing.com — The Dow Jones jumped Monday, recovering from its biggest weekly loss since September as investors resumed bullish betting ahead of economic data on inflation and a Federal Reserve rate decision expected later this week.

They gained 1.6%, or 528 points, the increase 1.3% and the increase 1.4%.

Energy stocks led the gainers as oil prices were boosted by allaying energy demand concerns after China, the world’s largest oil importer, moved further away from its zero-COVID policy. Beijing announced plans to stop tracking some travel activities, a move that could ease quarantine measures for travelers to COVID-affected regions.

Technology stocks, which fell 3% overall last week, weathered a continued rise in government bond yields as investors awaited further data expected Tuesday, which is expected to show easing inflationary pressures.

Economists predicted an increase of 0.3% in November and 7.3% over the past 12 months, compared to 0.4% and 7.7% respectively in the previous month.

However, expectations for a further decline in inflation are not expected to change the Fed’s monetary policy plans, with the US Federal Reserve slowing the pace of rate hikes but announcing a higher interest rate for a longer regime.

“I think the expectation is that we will see inflation come down over time, but that doesn’t mean the Fed can go easing all of a sudden,” Johan Grahn, Head of ETF Strategy at Allianz, told Investing’s Yasin Ebrahim .com. in a recent interview.

“They are [the Fed] we continue on the hawkish path, but a little more cautiously… starting at 50 basis points [on Wednesday] and more likely after that with 25 basis point increases,” Grahn added.

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Financials were boosted by rising banking stocks, with Goldman Sachs group (NYSE:) is recovering from an intraday dip after Bloomberg reported that the investment banking giant is about to cut further jobs as it restructures its consumer banking business.

In other news, Rivian Automotive (NASDAQ:) fell 6% after pausing plans to make electric vans in Europe as the loss-making electric vehicle maker looks to save money.

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