The markets continued the trend of “bad news is good news”, with all sectors closing in the green on the back of today’s ISM data. With ISM services coming in at 49.6 (down 6.9 points), it marks the first contraction since May 2020 and was the main fuel for today’s rally. Traders seem to be taking this ISM miss and a slowing in average hourly earnings (MoM) as a sign the Fed will soon pivot from rate hikes. Yields fell dramatically with the US10y retreating to 3.563%, the DXY (-1.08%) closed below 104, and the S&P(+2.28%) pushed to 3895.
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