New York: The Nasdaq Thursday ended as a sharp low federal ReserveThe U.S. announcement of a sharp end to pandemic-era stimulus pushed investors away from Big Tech into more financially sensitive sectors.
NVIDIA , Apple, Microsoft, Amazon and Tesla fell between 2.6% and 6.8%, beating the Nasdaq and the S&P 500, while the Dow Jones Industrial Average declined marginally.
Most of those heavyweight growth stocks have outperformed the broader market in 2021, with Nvidia up more than 100% year over year.
The Dow Jones Industrial Average fell 0.08% to end at 35,897.64, while the S&P 500 fell 0.87% to 4,668.67.
The Nasdaq Composite fell 2.47% to end at 15,180.44.
The US central bank said on Wednesday it would end its bond purchases in March and signaled a three-quarter-percentage-point interest rate hike through the end of 2022.
This is pleasing to investors who are concerned about inflationary growth related to the coronavirus pandemic. But it contributed to the sell-off in growth stocks on Thursday.
The S&P 500 price index climbed 0.7%, while the growth index fell 2.1%, reflecting investor views that high-growth stocks underperform when interest rates rise. Price indices include stocks that are seen as more likely to perform well during an economic recovery.
“You’re seeing money come out of growth, as it should be. If we’re going into an environment where interest rates are going up, growth stocks are going to be less attractive.” Dennis Dick, a trader at Bright Trading LLC.
“As we go into 2022, there’s a lot of uncertainty … we’re going to have a more aggressive Fed that’s going to take away the punch bowl,” he said.
Among the 11 major S&P 500 sector indexes, technology fell 2.9%, while financials rose 1.2%. Despite the decline in the overall index, eight sectors gained.
Lindsey Bell, chief investment strategist at Ally Invest in Charlotte, said: “The Fed gave the market what it wanted, and today I think investors are turning to the uncertainty of the pandemic again, and they’re also cautious towards the end of the year.” Huh.” , North Carolina.
Recent readings on rising producer and consumer prices as well as rapid spreads omicron The type of coronavirus, has fueled concern. The S&P 500, however, remains up about 25% in 2021 and is trading near record highs.
The CBOE Volatility Index, often considered Wall Street’s fear gauge, slipped to a three-week low.
Data shows the number of Americans filing new claims for unemployment benefits rose marginally last week, remaining at levels consistent with tightening labor market conditions.
Separately, a survey showed that production at US factories rose in November to the highest level in nearly three years.
Lenar Corp fell 4.1% after homebuilders missed analysts’ estimates for quarterly profit as pandemic-led supply chain issues pushed lumber costs higher and delayed home deliveries.
A decline in the number of moving issues on the NYSE to a 1.03-to-1 ratio; On the Nasdaq, a 1.93-to-1 ratio favored the decline.
The S&P 500 posted 69 new 52-week highs and 3 new lows; The Nasdaq Composite posted 43 new highs and 184 new lows.
Volume on US exchanges stood at 11.6 billion shares, in line with the average over the past 20 trading days.
NVIDIA , Apple, Microsoft, Amazon and Tesla fell between 2.6% and 6.8%, beating the Nasdaq and the S&P 500, while the Dow Jones Industrial Average declined marginally.
Most of those heavyweight growth stocks have outperformed the broader market in 2021, with Nvidia up more than 100% year over year.
The Dow Jones Industrial Average fell 0.08% to end at 35,897.64, while the S&P 500 fell 0.87% to 4,668.67.
The Nasdaq Composite fell 2.47% to end at 15,180.44.
The US central bank said on Wednesday it would end its bond purchases in March and signaled a three-quarter-percentage-point interest rate hike through the end of 2022.
This is pleasing to investors who are concerned about inflationary growth related to the coronavirus pandemic. But it contributed to the sell-off in growth stocks on Thursday.
The S&P 500 price index climbed 0.7%, while the growth index fell 2.1%, reflecting investor views that high-growth stocks underperform when interest rates rise. Price indices include stocks that are seen as more likely to perform well during an economic recovery.
“You’re seeing money come out of growth, as it should be. If we’re going into an environment where interest rates are going up, growth stocks are going to be less attractive.” Dennis Dick, a trader at Bright Trading LLC.
“As we go into 2022, there’s a lot of uncertainty … we’re going to have a more aggressive Fed that’s going to take away the punch bowl,” he said.
Among the 11 major S&P 500 sector indexes, technology fell 2.9%, while financials rose 1.2%. Despite the decline in the overall index, eight sectors gained.
Lindsey Bell, chief investment strategist at Ally Invest in Charlotte, said: “The Fed gave the market what it wanted, and today I think investors are turning to the uncertainty of the pandemic again, and they’re also cautious towards the end of the year.” Huh.” , North Carolina.
Recent readings on rising producer and consumer prices as well as rapid spreads omicron The type of coronavirus, has fueled concern. The S&P 500, however, remains up about 25% in 2021 and is trading near record highs.
The CBOE Volatility Index, often considered Wall Street’s fear gauge, slipped to a three-week low.
Data shows the number of Americans filing new claims for unemployment benefits rose marginally last week, remaining at levels consistent with tightening labor market conditions.
Separately, a survey showed that production at US factories rose in November to the highest level in nearly three years.
Lenar Corp fell 4.1% after homebuilders missed analysts’ estimates for quarterly profit as pandemic-led supply chain issues pushed lumber costs higher and delayed home deliveries.
A decline in the number of moving issues on the NYSE to a 1.03-to-1 ratio; On the Nasdaq, a 1.93-to-1 ratio favored the decline.
The S&P 500 posted 69 new 52-week highs and 3 new lows; The Nasdaq Composite posted 43 new highs and 184 new lows.
Volume on US exchanges stood at 11.6 billion shares, in line with the average over the past 20 trading days.
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