US stocks surge after worst week in nearly four months
![](https://www.cityam.com/wp-content/uploads/2021/06/Sell-In-Tech-Stocks-Sends-Markets-Down-Sharply-1317501406.jpg?w=742)
Wall Street rallied today, with the Dow Jones Industrial Average completing its strongest session in over three months as investors piled back in to energy and other sectors expected to outperform as the economy rebounds from the pandemic.
The S&P 500 value index, which includes banks, energy and other economically sensitive sectors and has led gains in US equities so far this year, surged 1.9 per cent, outperforming a 0.9 per cent rise in the growth index.
That was a stark reversal from last week, when the Fed’s hawkish signals on monetary policy sparked a round of profit taking that wiped out value stocks’ lead over growth this month and triggered the worst weekly performance for the Dow and the S&P 500 in months.
“The overall theme here is the market still does not know whether it wants easy money or tight money and it’s in a tug of war,” said Randy Frederick, vice president of trading and derivatives at Charles Schwab.
The Dow Jones Industrial Average rose 1.76% to end at 33,876.97 points, while the S&P 500 gained 1.40 per cent to 4,224.79. The Nasdaq Composite climbed 0.79 per cent to 14,141.48.
Fears of rising interest rates have controlled markets in recent weeks, with the benchmark index scaling record highs earlier this month following Fed comments that shrugged off the inflation jump as temporary.
“There is some conflicting news coming out of the Fed. Not all the presidents seem to be on the same page as the Fed chairman,” said Drew Horter, chief investment officer of Tactical Fund Advisors.
“I’m not a believer this inflation story is over anytime soon and raising rates may come sooner than 2023.”
London markets
London’s FTSE 100 clawed back losses today after opening at a one-month low following sharp falls in mining and travel stocks.
London’s FTSE 100 ended higher, helped by gains in mining and industrial stocks, while supermarket chain Morrisons was the top gainer on the mid-cap index following a proposed takeover offer.
After falling as much as 0.98 per cent to its lowest since 19 May, the blue-chip index retreated to end 0.6% up. Base and precious metal miners, rose 0.9% and 0.2 per cent respectively.
The domestically focused mid-cap index advanced 0.6 per cent.
Morrisons surged 34.6 per cent on hopes US private equity firm Clayton, Dubilier & Rice (CD&R) might raise its proposed offer, despite its initial proposal being rejected.