The key catalyst came from the Institute for Supply Management (ISM). Its Manufacturing Purchasing Managers’ Index, or PMI, rose to 52.6 in January from 47.9 in December, expanding at the fastest pace since 2022.
New orders strengthened, which investors often treat as an early signal for output and earnings momentum. However, the report also showed higher input-price pressure, which markets watch for inflation risk.
Bond markets reacted quickly. The 10-year US Treasury yield rose to about 4.27%, while the 2-year yield climbed to about 3.57%, suggesting traders still expect restrictive policy to linger.