Stocks rise with the start of October and a new quarter, Dow Jones rises more than 800 points

Stocks rose on Monday to start the new month and quarter, as Treasury yields tumbled from levels not seen in nearly a decade.

The Dow Jones Industrial Average jumped 840 points, or 2.9%. The S&P 500 is up 2.9%, after falling on Friday to its lowest level since November 2020, and the Nasdaq Composite is up 2.5%.

These moves came as a yield on 10-year US Treasuries rolled to trade at around 3.659%, after topping 4% at one point last week.

“It’s very simple at this point, the 10-year Treasury yield is going up and stocks are likely to remain under pressure,” said Raymond James’s Tavis McCourt. “It’s going down, and the stock is going up.”

Wall Street is going through a tough month, with the Dow and S&P 500 posting their biggest monthly losses since March 2020. The Dow also closed below 29,000 on Friday for the first time since November 2020.

The Dow Jones fell 8.8% in September, while the S&P 500 and Nasdaq Composite lost 9.3% and 10.5%, respectively.

For the quarter, the Dow Jones fell 6.66% to post a streak of three-quarter losses for the first time since the third quarter of 2015. The S&P and Nasdaq Composite fell 5.28% and 4.11%, respectively, to end their third consecutive negative quarter. For the first time since 2009.

Monday’s rally is unsurprising given how oversold the markets are, according to Sam Stovall, chief investment strategist at CFRA.

He told CNBC, “With the S&P down more than 9% in September…because the ISM was weaker than expected — as is construction spending — people are now imagining, hey, maybe the Fed won’t be that strong.” . “As a result, we’re seeing lower yields, we’re seeing a weaker dollar. These factors are contributing to the move we’re seeing today.”

As the new quarter begins, all S&P 500 segments are down at least 12% from their 52-week highs. Nine sectors ended the quarter in negative territory.

Investors are just starting to give up hope for a year-end rally, but Stovall said the market can still get one, noting that year-end rallies Historically stronger in midterm years.

“We can see an uptick because the midterm election years in the last quarter of the year are the second-best average quarter, and they also have the second-highest rate of progress,” he said. “The best is next, ie the first quarter of the third year. We may at least be surprised by an upward movement in the near term.”