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Stocks rally in risk-on start to August as yields fall

The S&P 500 rose 1.50% and the Nasdaq gained 2.13%, with Treasury yields dropping across the curve after an ISM report showed the factory sector expanding.

Reported · Written up by our desk · Major Pairs

U.S. stocks kicked off August with a risk-on rally, lifting the S&P 500 by 1.50% and the Nasdaq by 2.13%, as falling Treasury yields and sharply lower oil prices supported equities, according to Forexlive’s market wrap.

The ISM Manufacturing report added to the upside, showing the headline index at 55.6 versus a 54.0 consensus and up from 53.3 in June, with New Orders in expansion at 56.7 and the Employment Index rising to 52.8 from 49.7 for the first time in 33 months.

Forexlive also highlighted New York Fed President John Williams’ remarks that the Fed’s July decision left interest rates “well positioned” to return inflation to the Fed’s 2% target, while he said the central bank remains committed to price stability and would act if inflation does not move back sustainably.

Technology stocks led the advance, with Meta up 6.02%, Microsoft up 4.93%, Alphabet up 4.88%, Amazon up 4.58%, Tesla up 3.49%, and Nvidia up 2.93%, while Apple fell 1.78% as investors digested last week’s earnings and outlook; the bond tailwind included a 5.1 basis point drop in the 2-year yield to 4.239% and declines of 7.2 basis points on the 5-year and further movement on the 10-year.

Latest closeS&P 500 7,600.50 ▲1.5%|Nasdaq Comp. 25,913.90 ▲2.1%

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