S&P 500 slips as tech stocks pull market lower




By Herbert Lash


NEW YORK (Reuters) – The closed lower on Wednesday, unable to halt the prior day’s selloff, as investors set aside optimism about the economic recovery by Federal Reserve Chair Jerome Powell and Treasury Secretary Janet Yellen.



The remarks by the top two U.S. economic officials mirrored what they told Congress the day before, with Powell saying on Wednesday the most likely case is 2021 will be “a very, very strong year.”


has seesawed this week as a months-long rotation into economically sensitive energy and financial shares, which have gained on a growing outlook, was upended by falling bond yields that prompted beaten-down technology stocks to rise.


The 10-year yield fell to about 1.6%, a slide that had propped up highly valued technology shares that led the Nasdaq to double from year-ago lows. Value-oriented shares on Wednesday outpaced a decline in growth stocks, which include tech shares.


Investors have focused on the yield on the benchmark 10-year Treasury note, pondering whether there is room for long-term interest rates to run, said David Kelly, chief global strategist at JPMorgan Asset Management.


“We’re in a little bit of a lull here. We know that the economy is primed to begin to really accelerate in the second quarter,” Kelly said. “But we haven’t seen that acceleration yet so that’s what we’re waiting for.”


Adding to an upward bias for most of the session was data showing U.S. factory activity picked up in early March amid strong growth in new orders. But supply chain disruptions continued to exert cost pressures on manufacturers, keeping inflation fears in focus.


“Everybody’s bullish about the prospects of a recovery right now,” said David Yepez, lead equity analyst and portfolio manager at Exencial Wealth Advisors. “In order for the market to bottom we need to have more fear, and I don’t feel like the market has fear right now.”


Financials and industrials gained, while energy jumped as crude prices rebounded from a 6% fall in the last session. [O/R]


Unofficially, the Dow Jones Industrial Average fell 5 points, or 0.02%, to 32,418.15, the lost 21.37 points, or 0.55%, to 3,889.15 and the Nasdaq Composite dropped 265.81 points, or 2.01%, to 12,961.89.


Apple Inc, Tesla Inc and Facebook Inc led decliners on the


Intel Corp retreated after earlier gains as the company, in its efforts to expand chipmaking capacity, announced plans to spend as much as $20 billion to build two factories in Arizona and open its factories to outside customers.


U.S.-listed shares of Taiwan Semiconductor dropped, while semiconductor equipment makers Lam Research Corp, Applied Materials Inc and ASML Holding rose. Applied Materials was the biggest boost on the S&P 500.


Bitcoin gained after Tesla’s founder, Elon Musk, said the company’s electric vehicles can now be bought using bitcoin and the option will be available outside the United States later this year.


GameStop Corp tumbled more than 30% after the videogame retailer said it might cash in on a meteoric rise in its share price to fund its e-commerce expansion.


 


(Reporting by Herbert Lash in New York; Additional reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Maju Samuel and Matthew Lewis)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor





Source link