By Yasin Ebrahim
Investing.com – The Dow swung between gains and losses on Wednesday as investors continued to back tech while sectors tied to the progress of the economy faltered amid rising Covid-19 cases.
The S&P 500 gained 0.14%, while the Nasdaq Composite gained 0.71% and the Dow Jones Industrial Average rose 0.03%.
Coronavirus cases in the U.S. have topped three million weeks after reaching two million, driven by the rapid spread of the virus in Florida, California and Texas.
The resurgence of the virus has reined in the paced of the economic recovery seen in the previous weeks as some states pause or roll back reopening plans, prompting investors to pull their bets on sectors tied to the progress of the economy.
United Airlines (NASDAQ:UAL) pared intraday and moved into the green losses after announcing it would cull 36,000 workers, or nearly half of its workforce, when Cares Act funding runs out on Oct. 1.
American Airlines (NASDAQ:AAL), and Delta Air Lines (NYSE:DAL) also traded above the flatline.
But the resilience in tech continued to prop up the broader market.
Apple (NASDAQ:AAPL) hit all-time highs as Wall Street continued to back the stock on signs of a strong rebound in sales.
Deutsche Bank (DE:DBKGn) analyst Jeriel Ong raised his price target on Apple to $400 from $380, and maintained a buy rating on the stock, citing "prospects of a V-shaped recovery in Apple sales," and App Store revenue strength.
Twitter (NYSE:TWTR), surged 6% as investors cheered signs that the company is taking steps to boost sales. The social media company posted a job listing for a new team, codenamed Gryphon, that would focus on building a subscription platform.
Facebook (NASDAQ:FB), however, turned positive despite ongoing headline risk in the wake an audit commissioned by the social media company found its decisions were causing significant setbacks for civil rights.
But some have warned the tech-heavy rally is running too hot.
"The fact that the NASDAQ continues to press to new highs as broad participation weakens further is a clear and present divergence that needs to be repaired in the weeks ahead. If not, it would point to a bigger correction ahead, in our opinion," warned Janney Montgomery Scott's Director of Research, Dan Wantrobski.
Energy cut some of its losses as oil prices rebounded from lows, shrugging off data showing a surprise weekly build in crude inventories.
Oil stockpiles rose 5.65 million barrels for the week ending July 4, the government agency said Wednesday. Analysts followed by Investing.com had forecast a draw of 3.1 million barrels. Inventories fell 7.1 million barrels the previous week.
In earnings news, Levi Strauss (NYSE:LEVI) swung to a loss and reported that sales slumped 62% in the second quarter, as store closures weighed on growth, sending its shares down more than 8%