- S&P 500 Bounces Off Make-Or-Break Technical Level: Markets Wrap
- Morgan Stanley’s Wilson says US stocks can rally in short term
- Dip buyers wager US will lead way out of turmoil: MLIV Pulse
Stocks saw big gains Monday, with the S&P 500 closing above a key technical level and another giant bank coming out with solid results. A reversal of the UK’s vast fiscal stimulus also bolstered trader sentiment.
The breadth of the rally was so strong that at one point over 99% of the companies in the US equity benchmark were up, with the gauge pushing away from its 200-week moving average. The tech-heavy Nasdaq 100 outperformed, notching its biggest gain since July.
A rout in the S&P 500 has left the index testing a ‘serious floor of support’ which could lead to a technical recovery, Morgan Stanley’s Mike Wilson wrote. The strategist, who’s one of Wall Street’s most-prominent bearish voices, said he “would not rule out” the measure rising to about 4,150. That’s 13% above current levels.
“Stocks may be ripe for a near-term bounce,” wrote BCA Research strategists led by Roukaya Ibrahim. “While economic conditions have not changed — and therefore do not warrant a shift in the cyclical outlook — technical conditions are pointing to a potential rebound.”
The arrival of earning has historically served as a remedy for ailing equities, lifting the S&P 500 roughly 76% of the time since 2013. Cut-to-bone profit estimates are making the hurdles easy to clear.
Data Monday showed a measure of New York state manufacturing contracted for a third month in October, and a larger share of factories were more downbeat about business conditions in early 2023. The prices-paid measure rose for the first time since June.