Wall Street Rebounds From Last Week’S Rout, As Dow Closes Nearly 500 Points Higher.

Wall Street’s major indexes saw a significant increase of over 1 percent on September 9th as investors seized the opportunity to buy the dip following last week’s disappointing jobs report and lackluster manufacturing numbers, which triggered a sharp selloff in risk assets, including equities.

After having some time over the weekend to reflect, investors realized that there was an overreaction to the economic data from the previous week. The exaggerated fears of a potential recession were unfounded, said Kristina Hooper, Chief Global Market Strategist at Invesco. Taking a pause now provides an opportunity to approach the situation more rationally.

Various analysts at major banks have assigned different probabilities to a U.S. recession, with Goldman Sachs at 20 percent, UBS Global Wealth Management at 25 percent, and JP Morgan Chase at 35 percent. On Monday, Morgan Stanley even reduced its oil forecast, stating that traders are factoring in a demand slowdown comparable to a mild recession.

Market strategists suggest that the buying spree in stocks on Monday was a classic dip-buying behavior, as investors sought out undervalued opportunities.

Phil Blancato, Chief Market Strategist at Osaic Wealth in New York, observed that investors were specifically targeting high-quality stocks that were trading at lower valuations. As an example, he mentioned the shares of chipmaker Nvidia, which experienced a 15.3 percent decline last week but rebounded with a 3.5 percent increase on Monday.

This Wednesday, the CPI inflation report is expected to indicate a slight decrease in the headline inflation rate for August, settling at 2.6 percent year-over-year. However, the monthly inflation rate is projected to remain unchanged at 0.2 percent.

Another significant event for investors to consider is the upcoming presidential candidate debate between former President Donald Trump and Vice President Kamala Harris, scheduled for September 10th.

ABC will host the 90-minute debate in Philadelphia. Over the weekend, the Harris campaign launched a new webpage called “A New Way Forward,” outlining her policy stances on critical issues such as border policies and the economy.