US stocks are rebounding after a very ugly start to the month.
Near 12:31 p.m. ET, the Dow was up 144 points, the S&P 500 was up 12 points, and the Nasdaq was up 38 points.
The rally on Wednesday morning pulled the S&P 500 out of correction territory – defined as a 10% drop from recent highs. But after last week's carnage, the indexes are still red for the year, with the Dow leading the pack at -9%.
Stocks had the worst start to September in 13 years, and this is historically the weakest month of the year for US equities. On Tuesday, the three major indexes fell nearly 3%.
(Investing.com)
Experts pointed, again, to concerns that the world economy was slowing down and what this meant for US stocks. We got ISM manufacturing data from China and the eurozone, showing that the sector was softer in both regions. Meanwhile, we learned that Canada entered a recession after its
economy shrank for a second straight quarter.
In a morning note to clients, Deutsche Bank's Jim Reid wrote of the volatile financial environment:
"One of the biggest problems we face is that there is no historical template for current global market conditions so we're all flying blind to a large degree. Never before have so many of the most important countries in the world printed so much money and left base rates at near zero for so long. Also never before has the largest economy in the world tried to start a slow process of reversing said extraordinary policy."
We're just two days away from getting the biggest jobs report in several years, since many market participants had wagered that the economy was improving at a decent enough pace to warrant a rate hike from the Federal Reserve later this month. Those bets declined after the stock market's wild swings, but Friday's nonfarm payrolls data will still be incredibly significant and closely watched.
And Wednesday morning, we got the first snapshot of how the labor market did last month through the ADP private payrolls numbers. At 190,000, private-payrolls growth missed expectations.
The Federal Reserve's beige book, with anecdotes from its districs, showed that the economy is still growing at a modest pace.
The Energy Information Administration said crude oil inventories rose by 4.7 million barrels last week, more than expected. A separate print on Tuesday, from the American Petroleum Institute, indicated a build by 7.6 million barrels, the largest since April 7.
On Tuesday, West Texas Intermediate crude oil collapsed more than 10% to wipe out its biggest three-day gain in 25 years, as the industry continues to assess the extent of oversupply in the market.
WTI remains volatile, and after today's inventories data, it fell more than 4% to as low as $43.22 per barrel.
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