Dow up about 300; S&P 500 up for a 5th straight day

October 06 00:26 2015

Stocks kicked off the week in rally mode with the Dow jumping about 300 points Monday as investors view a Federal Reserve interest rate hike this year as less likely after Friday’s weak jobs report raised questions about the pace of U.S. growth. For the second straight month, the U.S. economy created less than 200,000 jobs in September — and fell shy of expectations — a weak reading that prompted Wall Street to scale back its expectations for a coming rate hike. The so-called lower for longer interest rate bet looks like it is back in vogue.1215-stock-market_full_600

“The market expectation for Fed lift-off was delayed furrther,” Barclays told clients in a note before Monday’s opening bell on Wall Street. Citing trading in futures, Barclays said the market now sees the first rate hike in the second quarter of 2016. The delay in lift-off has — at least for the moment — taken away a big uncertainty for financial markets in 2015, as most expected a hike last month and some time later this year. That has given U.S. stocks a lift. The Dow Jones industrial average, which rose 200 points Friday after being down more than 200 points earlier in the session, was up about 297 points, or 1.8%, at 2:50 p.m. ET. The blue-chip index is on track for its first back-to-back 200 point gains since Aug. 26-27 and if the gains hold it will be the third 200-point gain out of the last 4 sessions.

The Standard & Poor’s 500 stock index was up 1.8%, putting the broad-based index on track for its fifth straight day of gains. The Nasdaq composite jumped 1.5%. A rally in risk assets, which began on Wall Street late Friday, spread across the globe Monday. Shares of Japan’s Nikkei 225 rose 1.6% and the Hang Seng index in Hong Kong rallied 1.6%.

European shares also shot up. The broad STOXX Europe 600 index was 2.9% higher. Local stock markets also gained. The CAC 40 in Paris surged 3.6%, the DAX in Germany jumped 2.7% and London’s FTSE 100 shot up 2.8%. The market could be setting up for a fourth-quarter rally after a tough stretch, says Ari Wald, a technical strategist at Oppenheimer.