Buyers Making A Comeback On Wall Street Tuesday

Many traders had hoped that such support measures, which could include an interest rate cut, would have come from Beijing over the weekend after its main stocks markets slumped 11 percent last week. The world’s second-largest economy moved two weeks ago to devalue its currency, the yuan, on the heels of continued weakness in its economic data.

Chris McGrath-Getty Images A man looks at a screen showing global stock market information on the street in Tokyo on August 25, 2015.

All 10 major S&P sectors were higher with the technology index’s 2.87 percent rise leading the advancers.

The S&P 500 earnings outlook improved as well: Second-quarter expectations now are for a 1.3% increase, sharply above the 3% decline expected at the start of last month.

Monday’s roller-coaster makes it more hard for the Federal Reserve to do something it hasn’t wanted to accomplish for years: raising interest rates.

The Shanghai Index fell 8.5 percent and on Wall Street the mood was grim. “That’s obviously the biggest concern out there”, said Mark Luschini, chief market strategist at Janney Capital Markets.

“Global demand remains lackluster at best and while I expect the market to move mostly sideways, whatever action we are going to see today is going to be very sloppy”.

Chinese investors represent more than 50 percent of foreign holders of U.S. equities, Johnson added. The S&P (SPX) fell 20 points, or 1 percent, to 1,951. U.S. crude dropped 3.83% to $38.90, while Brent, the worldwide benchmark declined 3.85% to $43.71 a barrel. Japan’s share prices dropped almost 4.0 percent, closing at 17,806.70 following a 4.6% plunge on “Black Monday” to the lowest level seen since late February.

In a flight to safety, traders snapped up 10-year U.S. Treasury bonds. The stock had slumped as much as 13 percent on Monday, before ending down 2.5 percent. “This is the first year that the economy is outperforming the financial markets, it’s been the other way around for the past five years”.