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U.S. stocks jump 2% after recent selloff; yen drops vs dollar

The Dow Jones Industrial Average rallied 641 points (2.2%) to 30,530, the S&P 500 Index advanced 90 points (2.5%) to 3,765, and the Nasdaq Composite gained 271 points (2.5%) to 11,069. In moderately heavy volume, 5.2 billion shares of NYSE-listed stocks were traded, and 5.1 billion shares changed hands on the Nasdaq. WTI crude oil rose $1.53 to $109.52 per barrel. Elsewhere, the gold spot price was down $7.90 at $1,832.70 per ounce, and the Dollar Index lost 0.3% to 104.43.


Stocks recovered somewhat from last week’s drop that saw the S&P 500 join the NASDAQ and Russell 2000 in bear market territory. Persistently hot inflation has forced the Fed to get more aggressive with its monetary policy, and last week it raised the target for the fed funds rate by 75 basis points (bps) and suggested more hikes of that magnitude could come as discussed by Schwab’s Chief Investment Strategist Liz Ann Sonders in her article, Fed Goes for Inflation’s Jugular With 75bps Rate Hike. Liz Ann examines the rate hike and how the Fed vowed to forcefully tackle inflation, while conceding the path to a soft landing has become “more challenging.” Recession chatter has picked up, contributing to the volatility in the markets.


Amid this market backdrop, Liz Ann notes in her article, Panic Is Not a Strategy—Nor Is Greed, discussing how disciplined investing helps investors navigate through volatile environments. You can follow Liz Ann on Twitter: @LizAnnSonders.


Read all our market commentary, including our commentaries, Stock Market Volatility: Bear Market Territory, and 7 Investing Strategies to Prepare for Bear Markets, on our Insights & Education page, and you can follow us on Twitter at @SchwabResearch.


In equity news, Kellogg Company (K $70) announced plans to separate into three independent public companies by spinning off its U.S., Canadian, and Caribbean cereal and plant-based businesses, which collectively represented approximately 20.0% of its net sales in 2021. The remaining business, which represented about 80.0% of net sales in 2021, is focused on global snacking, international cereal and noodles, and North American frozen breakfast. The three companies will be “Global Snacking Co.,” “North American Cereal Co.,” and “Plant Co.,” with the names of the companies to be determined later. The company said this action is aimed at enhancing performance and value by creating greater strategic, operational, and financial focus for each company and its stakeholders. Shares traded higher.


Tesla Inc. (TSLA $711) was in focus after CEO Elon Musk said the company will cut its salaried workforce by roughly 10% over the coming three months, while increasing its hourly-paid employee base over the longer term. TSLA rose nearly 10%.

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