[New York Stock Market] Rise on China's Tariff Easing and Bargain Buying... Nasdaq Up 1.59%

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] The major indices of the U.S. New York stock market, which had been declining for several weeks, all closed higher on Monday, the 23rd (local time). This was thanks to investors' bargain hunting, mainly in financial stocks. U.S. President Joe Biden's announcement that he is considering easing tariffs on China also had a positive impact on the market. However, some still warn of the possibility of further declines.

On this day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 31,880.24, up 618.34 points (1.98%) from the previous session. The S&P 500, focused on large-cap stocks, rose 72.39 points (1.86%) to 2,973.75, and the tech-heavy Nasdaq increased by 180.66 points (1.59%) to 11,535.28. The small-cap Russell 2000 also gained 19.50 points (1.10%) to 1,792.76.

Financial stocks showed strength by sector. JPMorgan Chase closed more than 6% higher after raising its net interest income forecast for the year. Citigroup (+6.15%), Bank of America (BoA, +5.94%), and Wells Fargo (+5.18%) also jumped between 5% and 6%.

Consumer staples stocks also performed well. Discount retailers Ross Stores and TJX rose 9.57% and 4.27%, respectively. This week, earnings reports from Costco, Dollar General, Nordstrom, and Macy's are expected to be released. Accordingly, investors seem likely to seek confirmation of inflation concerns in the market, as previously seen with Walmart and Target.

Meanwhile, semiconductor company Broadcom surged nearly 25% after reports that it is exploring the acquisition of cloud computing firm VMware. Conversely, Broadcom's stock price fell more than 3%. Apple jumped over 4% following reports that the company plans to increase outsourced production in India and Southeast Asia to reduce its dependence on China.

Leading tech stock Tesla rose 1.66%, and Nvidia, which is set to release earnings this week, gained 1.22%. Electronic Arts climbed more than 2% on news that it is actively seeking sales or mergers. Zoom Video is scheduled to release its earnings after the market close.

On this day, a rebound buying trend was observed, mainly in financial stocks, following weeks of declines. In particular, President Biden's statement at a press conference after the U.S.-Japan summit that he is considering easing tariffs on some Chinese goods is seen as having encouraged buying. European markets, including the FTSE 100 in London, also closed higher following this announcement.

The S&P 500 entered a bear market on Friday the 20th, falling more than 20% from its previous high. On a weekly basis, the S&P 500 and Nasdaq have declined for seven consecutive weeks, while the Dow has fallen for eight straight weeks. John Stoltzfus, Chief Investment Strategist at Oppenheimer, pointed out that the market appears to be "oversold."

However, experts caution that it remains to be seen how long the three major indices can sustain this rebound. Warnings remain that further declines are still possible.

Wayne Wicker, Chief Investment Officer at MissionSquare Retirement, said, "Given that many stocks have fallen so far, this rebound is not surprising," but added, "Investors should expect continued short-term volatility due to inflation, interest rate hikes, and geopolitical risks."

The Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as Wall Street's "fear gauge," fell more than 3% from the previous session and is trading around the 28 level. In the New York bond market on this day, the 10-year Treasury yield rose to around 2.86%.