US stocks record their best week since November 2020 | Financial market news

The S&P 500 erased its May losses and posted its biggest weekly gain since November 2020.

By Bloomberg

Stocks continued to rebound after a steep rout that sent the market tumbling for seven straight weeks as rebalancing by institutional investors potentially lifted stocks late in the month.

The S&P 500 erased its May losses and posted its biggest weekly gain since November 2020. Global stock funds saw their biggest inflows in 10 weeks, led by U.S. stocks, according to a note from Bank of America Corp. citing EPFR data. The Nasdaq 100 outperformed major benchmarks, with Apple Inc. and Tesla Inc. up more than 4%. Dell Technologies Inc. jumped as revenue beat estimates. The dollar fell, while Treasuries fluctuated. US markets will be closed on Monday for a public holiday.

Volatility gripped markets this year on fears that hawkish central banks could tip the economy into a recession, with analysts remaining divided on whether stocks have bottomed. Morgan Stanley and Bank of America recently said there could be more losses ahead, while BlackRock Investment Institute cut developed market shares to neutral. Meanwhile, Citigroup Inc. strategists have recommended returning to equities, particularly in Europe and emerging markets, due to their attractive valuations.

“It’s right at this point to start bargain hunting,” Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, told Bloomberg Television. “If you can get people more comfortable with the fundamental narrative going forward, I think stocks are cheap enough to buy. Are valuations a reason to buy on their own? Again.”

After a major outperformance against growth stocks this year, value stocks are beginning to lose appeal as bond yields peak and the economic recovery stalls, strategists at Credit Suisse Group AG and Bank of America. Value companies have been largely shielded from the market selloff this year as investors turn to cheaper stocks in search of shelter from fears of a rate hike.

US consumer confidence deteriorated further in late May to a new decade low as growing concerns about inflation clouded the outlook for the economy. A separate report showed inflation-adjusted consumer spending rose the fastest in three months in April, indicating that households were resisting lingering price pressures by tapping into savings.

Some of the major movements in the markets:

Shares

  • The S&P 500 rose 2.5% at 4 p.m. PT
  • The Nasdaq 100 rose 3.3%
  • The Dow Jones Industrial Average rose 1.8%
  • The MSCI World index rose 2.2%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.3%
  • The euro was little changed at $1.0733
  • The British Pound rose 0.2% to $1.2631
  • The Japanese yen remained unchanged at 127.12 per dollar

Obligations

  • The yield on 10-year Treasury bills fell one basis point to 2.74%
  • Germany’s 10-year yield fell four basis points to 0.96%
  • The UK 10-year yield fell five basis points to 1.92%

Goods

  • West Texas Intermediate crude rose 0.9% to $115.14 a barrel
  • Gold futures rose 0.2% to $1,857.10 an ounce

–With help from Andreea Papuc, Isabelle Lee and Peyton Forte.