NEW YORK (Reuters) – The blue-chip Dow closed to its fifth consecutive high record on Friday and the S&P 500 closed slightly higher as investors bought shares that should benefit from the strong reopening of the U.S. economy, a view that is characterized by increased yield in the bond market.
The tech-heavy Nasdaq fell after going back more than 6% over the past three sessions as bond yields rose reviving inflation concerns and continuing to forward attractive high-tech technology segments.
The S&P 500 and Nasdaq posted their biggest weekly percentage gains since early February after President Joe Biden enacted law on Thursday one of the largest U.S. fiscal stimulus bills and declarations that data confirmed that the economy was recovering from major growth.
The recent rise in U.S. Treasury yields has raised fears of a sharp decline in monetary stimulus and put pressure on Wall Street in recent weeks.
Yields on the 10-year note hit the 1.642% benchmark on Friday, the highest level since February last year. [US/]
Boeing Co rose 6.82% to lead the Dow and S&P 500 higher. The rising and falling Dow Nasdaq shows continued sales in technology as investors buy revolving and underground value stock that is expected to do well as the economy recovers. recovering.
For tech stocks to continue to thrive you need low rates, and indeed slower growth, said Thomas Hayes, chairman and managing member of hedge fund Great Hill Capital LLC.
But with the stimulus package the economy is likely to expand 7% to 9% this year with flat rates of pressure, he said.
“That’s why you’re seeing rates rise today as the reopening is happening faster and stronger than expected. And that’s when value and economically sensitive cycles and stocks perform better, ”said Hayes.
The rapid rollout of vaccines and increased fiscal support have raised concerns about inflation despite a commitment by the Federal Reserve to maintain an accommodation policy. All eyes will be on the central bank’s policy meeting next week for further views on inflation.
U.S. consumer sentiment improved in early March to the strongest level in a year, a study by the University of Michigan showed Friday.
The Dow Jones industrial average rose 293.05 points, or 0.9%, to close at 32,778.64 and the S&P 500 gained 4 points, or 0.10%, to 3,943.34. The Nasdaq Composite fell 78.81 points, or 0.59%, to finish at 13,319.87.
For the week, the S&P rose 2.6%, the Dow added 4.1% and the Nasdaq gained 3.1%. For the Dow it was the biggest weekly gain since November.
U.S. exchanges totaled 11.64 billion shares.
The Nasdaq has been particularly hit by sell-offs in recent weeks and confirmed a correction earlier in the week when investors exchanged high-value technology stocks with stocks of energy, mining companies. and businesses that are poised to reap more benefits from economic recovery. .
Stocks added value around 0.80%, while growth stocks fell 0.62% in a sustained movement that began late last year.
The group fell high-flying stock but was aware of yields including Facebook Inc, Apple Inc, Amazon.com Inc, Netflix Inc, Google-parent Alphabet Inc, Tesla Inc and Microsoft Corp, which prompted this year’s rally to gone.
Tech, communications services and consumer selective indexes, which include these mega-cap stocks, have slipped among the top S&P categories.
The bank’s index jumped 1.83%, while finance and businesses reached new levels.
Ulta Beauty Inc fell 8.4% after the cosmetics retailer forecast annual revenue below estimates, as demand for make-up products came under pressure as a result of expanded work-from-home policies.
US-listed shares of China-based JD.com Inc slipped 6.7% after three sources said the company is in talks to buy part or all of Sinolink Securities’ worth of $ 1.5 billion worth of bankruptcy. buy.
Taking forward higher-than-expected NYSE declines with a 1.24-to-1 ratio; on Nasdaq, a 1.14-to-1 ratio of promoters was preferred.
The S&P 500 raised 83 new 52-week highs and no new levels; the Nasdaq Composite recorded 396 new highs and 12 new lows.
Reporting with Herbert Lash in New York; Further statement by Medha Singh, Shashank Nayar and Sagarika Jaisinghani in Bengaluru; Edited by Maju Samuel and Matthew Lewis