[New York Stock Exchange] Rises on Improved U.S. Manufacturing Data... Dow Up 1.05%

On February 2 (local time), all three major indices on the New York Stock Exchange closed higher. Although gold, silver, and Bitcoin had previously plunged, the situation stabilized somewhat, and the market ended on an upward trend, supported by robust manufacturing indicators.

On this day, the Dow Jones Industrial Average, which focuses on blue-chip stocks, closed at 49,407.66, up 515.19 points (1.05%) from the previous trading day. The S&P 500 Index, centered on large-cap stocks, rose by 37.41 points (0.54%) to 6,976.44, while the technology-heavy Nasdaq Index climbed 130.292 points (0.56%) to close at 23,592.107.

Reuters Yonhap News

The manufacturing Purchasing Managers' Index (PMI) released on this day showed solid figures, improving investor sentiment. S&P Global announced that the final manufacturing PMI for January recorded 52.5, surpassing the market expectation of 51.9.

The manufacturing PMI announced by the Institute for Supply Management (ISM) also reached 52.6. This figure was significantly higher than the market expectation of 48.5 and marked the eleventh consecutive month of expansion.

Florian Ielpo, Head of Macro at Lombard Odier Asset Management, stated, "This is fundamentally positive for corporate earnings and acts as a boon for both U.S. and global equities, thanks to the momentum of U.S. growth," adding, "In the short term, it further strengthens the 'Goldilocks' scenario, where robust growth and subdued inflation coexist."

This week, more than 100 S&P 500 companies are scheduled to announce their earnings. Overall, the performance has been evaluated as favorable so far. According to FactSet, about one-third of S&P 500 companies have reported earnings to date, and approximately 78% of them have exceeded expectations.

Amazon and Alphabet, Google's parent company, both rose on expectations ahead of their earnings announcements.

However, Nvidia, the leading artificial intelligence (AI) stock, fell nearly 3% after the Wall Street Journal reported that Nvidia's plan to invest $100 billion in OpenAI was facing difficulties.

Disney announced earnings that exceeded market expectations, but warned of a possible decline in domestic theme park attendance due to a decrease in international visitors, causing its stock price to fall by 7%.

Bitcoin, gold, and silver rebounded from their intraday lows, helping to limit the stock market's losses and ease risk aversion. Bitcoin traded around $78,000, while spot gold and silver prices fell by 4% and 5%, respectively.

There are mixed opinions in the market regarding the monetary policy stance of Kevin Warsh, the former Fed Governor who has been nominated as the next Federal Reserve Chair. Darrell Cronk of Wells Fargo said, "The hawkish perception regarding Warsh's nomination remains," but added, "I believe Warsh could take a more dovish stance if he faces difficulties in reducing the Fed's balance sheet." He continued, "We maintain our outlook that there will be two rate cuts this year."

In contrast, Raphael Bostic, President of the Federal Reserve Bank of Atlanta, stated that he does not expect any rate cuts this year. Referring to the Fed's projections released in December last year, he said, "In my case, I did not factor in any rate cuts," and added, "Because the U.S. economy has very strong momentum, it is necessary to keep rates at a somewhat restrictive level."

U.S. Treasury yields are on the rise. The 10-year U.S. Treasury yield, a global bond benchmark, rose by 4.2 basis points (1 basis point = 0.01 percentage point) from the previous day to 4.283%, while the 2-year U.S. Treasury yield, which is sensitive to monetary policy, increased by 4.9 basis points to 3.576%.