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Dow soars 1,086 points in a miraculous comeback

Stock markets staged a miraculous comeback Wednesday following their worst-ever ...

Posted: Dec 28, 2018 5:58 AM
Updated: Dec 28, 2018 5:58 AM

Stock markets staged a miraculous comeback Wednesday following their worst-ever Christmas Eve. The Dow posted its biggest daily point gain ever.

The Dow rose 1,086 points, gaining 5%. The S&P 500 also soared 5%, and the Nasdaq was up 5.8%, pulling out of bear market territory.

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The day marked the biggest percentage gain for all three indices since March 2009.

"Investors went bargain shopping the day after Christmas, where stocks just got too cheap relative to earnings, future earnings, any reasonable assessment of earnings," said Chris Rupkey, managing director of MUFG. "The coast is clear, back up the truck, investors are saying enough already, the world is not ending."

Stocks rose higher despite virtually no news — which may have been a catalyst in its own right. Thin trading and a lack of big news often send stocks higher in the last week of December.

President Donald Trump did not tweet until late in market hours Wednesday. Shortly after 2 pm ET, the White House announced Trump and the first lady traveled to Iraq on Wednesday. Recently, Trump has unsettled markets by signaling the potential firing of Federal Reserve Chairman Jerome Powell and a trade war escalation.

All but one stock in the S&P 500 rose Wednesday. Newmont Mining Corp (NEM), which fell 0.1%, was the sole loser. Newmont was the S&P 500's biggest gainer on Monday after gold prices rose.

Tech stocks led the rally. Amazon soared 9.5%, Facebook (FB), Netflix (NFLX) rose 8%, Apple (AAPL) jumped 7% and Alphabet (GOOGL) was up 6%.

Energy stocks were close behind, led by Marathon Oil (MRO), which surged 11.9% Wednesday. Hess (HES) was up 11%.

Consumer product stocks also rose sharply. Kohl's (KSS) was up 10.3% and Nike (NKE) rose 7.2%. Mastercard reported that the American retail industry had its best holiday season sales in six years. Amazon (AMZN) reported that it had a robust holiday period. That suggests rising wages and lower gas prices are helping boost consumer spending — the biggest contributor in America's GDP.

Even shares of department store JCPenney (JCP), which dipped below $1 for the first time, ended higher on the day. And Ford (F) stock, which hit a nine-year low earlier in the day, ended slightly higher.

One good day isn't a trend

Wednesday was a respite from a very rough month for investors.

Even after Wednesday's rally, the S&P 500 remains close to entering a bear market, which would end the longest bull market in history. This month is still on pace for the worst December since 1931, according to S&P Global Indices.

A partial government shutdown, Treasury Secretary Steven Mnuchin's questions about banks' health and signals that President Donald Trump could fire Federal Reserve Chairman Jerome Powell upset markets on Monday, sending the Dow down 653 points.

After markets tanked on Christmas Eve, Trump said Tuesday that he remains confident in Mnuchin, but he renewed his criticism of the Fed, accusing it of hiking rates too fast.

Those doubts come of top of worries about how sharply the US economy might lose steam next year.

The only certain thing about the market this month is uncertainty. The slightest bit of bad news can turn a rally into a rout.

Asian stocks rattled

European markets were closed Wednesday. In Asia, Japan's Nikkei swung between gains and losses before closing nearly 1% higher. The shaky trading followed a 5% plunge on Christmas Day that dragged the Japanese index into a bear market. In China, the Shanghai Composite shed 0.3% on Wednesday.

Markets have been rattled in recent days by fears of slowing economic growth, exacerbated by some unsettling moves from Washington.

The turmoil in Washington is making traders in other countries fret about the stewardship of the world's biggest economy.

Global investors have a laundry list of worries, including China's slowing economy, the Trump administration's trade war with China and the unpredictability surrounding Brexit.

"There's a lot of uncertainty, and that's one of the biggest things that the market doesn't like," Andrew Sullivan, a Hong Kong-based market economist, told CNN.

Indiana Coronavirus Cases

Data is updated nightly.

Cases: 701971

Reported Deaths: 13187
CountyCasesDeaths
Marion958051716
Lake51105939
Allen38867670
Hamilton34212404
St. Joseph33638539
Elkhart27021431
Vanderburgh22016393
Tippecanoe21602212
Johnson17408373
Porter17157297
Hendricks16711310
Clark12640190
Madison12287337
Vigo12139244
Monroe11336166
LaPorte10760204
Delaware10288184
Howard9606211
Kosciusko9051113
Hancock7922139
Bartholomew7839153
Warrick7671155
Floyd7533176
Wayne6871198
Grant6755168
Boone6517100
Morgan6362138
Dubois6068117
Marshall5743108
Dearborn566975
Cass5668102
Henry5558100
Noble536983
Jackson491869
Shelby476895
Lawrence4324118
Gibson426889
Harrison426070
Montgomery416286
Clinton415053
DeKalb405483
Huntington376480
Whitley374939
Miami371365
Knox364889
Steuben361357
Putnam351760
Wabash345877
Jasper344846
Adams337652
Ripley333268
Jefferson310779
White307154
Daviess288699
Wells284780
Decatur278592
Fayette276962
Greene269985
Posey268133
Scott259853
Clay252044
LaGrange250970
Randolph234380
Washington230329
Spencer227431
Jennings224447
Fountain207445
Sullivan207342
Starke201152
Owen191456
Fulton190439
Jay185529
Carroll185220
Perry179136
Orange176253
Rush170224
Vermillion165643
Franklin165135
Tipton160843
Parke143716
Blackford132631
Pike130034
Pulaski112945
Newton102834
Brown99340
Crawford96914
Benton95613
Martin82215
Warren78715
Switzerland7698
Union69510
Ohio55511
Unassigned0405

Ohio Coronavirus Cases

Data is updated nightly.

Cases: 1045945

Reported Deaths: 18917
CountyCasesDeaths
Franklin1214131352
Cuyahoga1060882061
Hamilton778281165
Montgomery49815988
Summit45000907
Lucas39675760
Butler37582568
Stark31296894
Lorain24038472
Warren23805291
Mahoning20777583
Lake19885362
Clermont19387228
Delaware17933130
Licking16066206
Fairfield15618196
Trumbull15500459
Medina14787259
Greene14593236
Clark13542288
Wood12664184
Portage12277194
Allen11281229
Richland11001198
Miami10500212
Muskingum8676127
Wayne8523209
Columbiana8515226
Pickaway8414120
Tuscarawas8347239
Marion8342135
Erie7509153
Ross6687145
Hancock6666123
Geauga6520146
Ashtabula6436164
Scioto6271100
Belmont5578158
Union555147
Lawrence5454102
Jefferson5271147
Huron5265113
Darke5256121
Sandusky5158119
Seneca5084118
Washington5056107
Athens497454
Auglaize473984
Mercer470084
Shelby454689
Knox4363108
Madison420458
Putnam419398
Ashland411586
Fulton406266
Defiance399496
Brown384855
Crawford3848100
Logan371976
Preble369298
Clinton359359
Ottawa354278
Highland345759
Williams321674
Champaign317856
Jackson306151
Guernsey305348
Perry289249
Fayette276748
Morrow274139
Henry262866
Hardin262663
Coshocton257857
Holmes252399
Van Wert238562
Gallia232946
Pike232331
Adams227152
Wyandot225553
Hocking208458
Carroll188547
Paulding168238
Meigs141138
Noble132537
Monroe128741
Morgan106423
Harrison104936
Vinton81314
Unassigned02
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There will be more clouds around than sunshine for most of the day and highs will top out in the upper 40s.
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