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The Dow gained 16 points, but most shares of the S&P 500 fell. Shares of electric vehicle giant Tesla continue in a bear market.
Shares were mixed on Wednesday, but did not move much. The market has worked hard and many stocks are taking off.
He
Dow Jones industrial average
it rose 16.02 points, or 0.05%, to close at 33,446.26, after spending much of the day in the red. He
S&P 500
added 6.01 points, or 0.15%, to finish at 4,079.95, while the
Nasdaq Composite
fell 9.54 points, or 0.07%, to close at 13,688.84. The biggest winner of the S&P 500 was
L Brands
(ticker: LB), the parent company of Victoria’s Secret, which saw shares rise 3.7% in an analyst update.
Meanwhile, the ultra-growth stocks were hammered.
Tesla
(TSLA) continues in a bear market after setting a record in January; shares of the electric vehicle giant fell 3% on Wednesday. Video conferencing giant actions
Zoom Video Communications
(ZM), which fell more than 40% from the all-time high in October, fell 2% more. Rising longer-term interest rates affect these actions because firms expect most of their long-term profits and their current valuations are vulnerable to higher rates.
However, the shares of companies with more mature growth performed well.
apple
(AAPL),
Facebook
(FB), i
Alphabet
(GOOGL) increased 1.3%, 2.3% and 1.3%, respectively. He
Nasdaq 100,
an index that includes large-cap technology stocks rose 0.28%.
Stocks are priced in a lot of good news, as fiscal stimulus and reopening are pushing the economy forward. Over the past 30 days, including Wednesday’s performance, the Dow and S&P 500 have risen 5% and more than 6%, respectively. Stock valuations are rich, while interest rates have risen, reducing the attractiveness of stocks relative to bonds. And the concentration has raised many sectors, which means that the shares have some disadvantage; According to Canaccord Genuity data, 86% of S&P 500 shares traded above 50-day moving averages. Wednesday’s weakness was almost as wide as the market’s rise; According to FactSet data, 61% of S&P 500 shares fell.
All this happens if there is no material evolution or change in the economic outlook. Billions of dollars of fiscal stimulus are already in circulation. President Joe Biden’s more than $ 2 trillion infrastructure plan doesn’t contain many positive surprises. The Federal Reserve made comments Tuesday afternoon, but did not reveal anything new. The first quarter earnings season has not yet begun, although investors will focus on results and guidance as companies begin to report.
As for the Fed, the shares didn’t even react to the central bank’s positive messaging, suggesting they are far from cheap. The Fed did not soon hint at higher interest rates. “There seems to be no hidden interest in higher rates, suggesting that rates will remain low until unemployment falls to pre-pandemic levels,” wrote Brad McMillan, investment director at Commonwealth Financial Network, in comments by email to the press. Even with this backdrop, stocks couldn’t gain much strength in the day.
“It’s possible for investors to have a look at what the next catalyst will be to move stocks, as the market has been virtually pronounced this week, it’s not bad as we’re at record highs,” said Mike Loewengart, CEO of E * Trade investment strategy, wrote in an email.
Write to Jacob Sonenshine to [email protected]