Dow, S&P 500, Nasdaq Gain; Federal Reserve News; Bitcoin, Ethereum Under Pressure; MongoDB, Snowflake, Credo, Nvidia and Other Stock Movers
The stock market bounced back on Tuesday as Wall Street bought the dip in Bitcoin and other riskier assets.
The Dow Jones Industrial Average rose 185 points, or 0.4%. The S&P 500 was up 0.3%. The Nasdaq Composite was up 0.6%.
Traders have been paying close attention to the price of Bitcoin, which rebounded sharply to move back above the $90,000 level on Tuesday.
“I think crypto having to stabilize is probably more important than people may think,” Sevens Report Research’s Tom Essaye told Barron’s. “It’s giving us a sort of a truer measure of this sort of ‘bullish impulse’ that’s really carried markets higher in the last couple of months. And the sooner that can stabilize and begin to move higher, the more that bullish sentiment comes back into the market and increases the chances that we could see a bounce into year end.”
Technology stocks, as well as crypto-linked firms and momentum plays, were in the driver’s seat within the S&P 500. Earnings from MongoDB and Credo Technology were also provided a strong start to this week’s earnings slate. The S&P 500 was choppy all day, moving up until it lost steam repeatedly after crossing the 6840 level.
“This has been a logical spot for the S&P 500 to pause,” Frank Cappelleri, founder of technical analysis firm CappThesis, told Barron’s. “The index just came off a five-day winning streak that produced roughly a 5% gain — a strong move by any measure — and it was accompanied by some of the broadest sector participation we’ve seen in months. At some point, the market simply needs to catch its breath on a short-term basis.”
He says the index lost steam just beneath the mid-November highs, which represents a point of resistance for the index.
“Best case: This consolidation evolves into another short-term continuation pattern, allowing the index to reset before pressing higher once again,” he says.
The yield on the 2-year Treasury note was down to 3.52%, while the 10-year yield was down to 4.09%. The 30-year yield was down to 4.74%.
“While U.S. rates have backed up modestly, it’s really the global bond market that needs to be watched,” Jonathan Krinsky, BTIG’s chief market technician, writes. “Obviously Japan is front and center but also watching German and French yields nearing breakouts.”
Traders see an 89.2% chance the Federal Open Market Committee opts for a quarter-point rate cut on Dec. 10, but that might not help much for longer-term rates; Krinsky points out that the 10-year yield actually moved higher following the last five Fed rate cuts.
