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Tech stock rally sends S&P and Nasdaq to record highs

Economy Jun 28, 2021 06:46PM ET
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© Reuters. FILE PHOTO: Dividers are seen inside a trading post on the trading floor as preparations are made for the return to trading at the New York Stock Exchange (NYSE), May 22, 2020. REUTERS/Brendan McDermid

By Krystal Hu and Medha Singh

(Reuters) - The Nasdaq and S&P 500 hit all-time highs on Monday, fueled by tech stocks as investors expect a robust earnings season while interest rates remain low.

Big tech companies including Facebook Inc (NASDAQ:FB), Netflix Inc (NASDAQ:NFLX), Twitter Inc (NYSE:TWTR) and Nvidia (NASDAQ:NVDA) Corp were among the biggest boosts to the S&P 500 and the Nasdaq.

The S&P 500 continued its recent momentum after paring some earlier losses, recording its third record high in a row, after logging its best weekly performance in 20 weeks last Friday.

In contrast, cyclical sectors dropped sharply amid fears over a spike in COVID-19 cases across Asia. Financials and energy posted the biggest sectoral loss on S&P 500, down by 0.81% and 3.33%, respectively.

"It's end of the quarter and investors may want to take some profits and rotate out of energy and stick with tech," said Sam Stovall, chief investment strategist at CFRA Research in New York.

Stovall expects stocks should continue their near-term climb as investors await the new earnings season, in which year-over-year earnings growth of S&P 500 companies is expected to top 60%.

The Dow Jones Industrial Average fell 150.57 points, or 0.44%, to close at 34,283.27. The S&P 500 pared earlier losses and advanced from Friday's record high by gaining 9.91 points, or 0.23%, to 4,290.61. The Nasdaq Composite added 140.12 points, or 0.98%, to 14,500.51.

Both the S&P 500 and the Nasdaq hit a series of record highs last week. the tech-heavy Nasdaq's 5% gain in June is outpacing its peers as investors pile back in to tech-oriented growth stocks on diminishing worries about runaway inflation.

"We believe with the Fed putting a realistic goal post, investors now have much more of a risk-on mentality going into the second half of the year. A lot of these tech names have underperformed, while fundamentals were very robust going into the June quarter," said Wedbush Securities analyst Daniel Ives, who expects the Nasdaq to hit 16,000 by year-end.

Facebook jumped over 4% as a U.S. judge granted the company's motion to dismiss a Federal Trade Commission lawsuit. The social media giant finished Monday with over $1 trillion in market capitalization.

On the Nasdaq 100, the largest gainer was Nvidia Corp , which rose 5.0% after major chip makers Broadcom (NASDAQ:AVGO) Inc, Marvell (NASDAQ:MRVL) and Taiwan-based MediaTek endorsed its $40 billion deal to buy UK chip designer Arm.

With the S&P 500 up almost 14% as the first half of 2021 draws to a close, activity in some areas of the market indicates concern over potential volatility, with some investors suggesting the market may be overdue for a significant pullback.

On the economic front, investor attention will be focused on consumer confidence data, a private jobs report and a crucial monthly employment report due later this week. Quarterly results from Micron Technology Inc (NASDAQ:MU) and Walgreens Boots Alliance (NASDAQ:WBA) are also slated for this week.

Declining issues outnumbered advancing ones on the NYSE by a 1.38-to-1 ratio; on Nasdaq, a 1.09-to-1 ratio favored decliners.

The S&P 500 posted 36 new 52-week highs and no new lows; the Nasdaq Composite recorded 100 new highs and 31 new lows.

Volume on U.S. exchanges was 9.55 billion shares, compared with the 11.17 billion average for the full session over the last 20 trading days.

Tech stock rally sends S&P and Nasdaq to record highs
 

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Comments (10)
John Shiels
John Shiels Jun 28, 2021 3:30PM ET
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It’s opposite day! Read the fake news and go from there.
John Shiels
John Shiels Jun 28, 2021 3:29PM ET
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October 2002, lots of bagholders
Jouni Matero
Jouni Jun 28, 2021 2:21PM ET
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If you're interested of FED doing/undoings, you may be interested in reading this..https://www.reddit.com/r/Superstonk/comments/o0scoy/the_bigger_short_how_2008_is_repeating_at_a_much/
Mitchel Pioneer
Mitchel Pioneer Jun 28, 2021 1:56PM ET
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Record levels of fraud in the US Ponzi Scheme, laughingstock of the financial world.
Dannick Potvin
Dannick Potvin Jun 28, 2021 1:56PM ET
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you cant just say impactfull stuff without any facts supporting your claims.
Afed Afed
Afed Afed Jun 28, 2021 10:33AM ET
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crazy
Nadeem Khan
Nadeem Khan Jun 28, 2021 10:25AM ET
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Who is buying at record high levels
AI Wu
AI Wu Jun 28, 2021 10:25AM ET
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public driven by FOMO, the market market is selling...
Jouni Matero
Jouni Jun 28, 2021 10:25AM ET
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It's FED and big banks and their puppets running the show Totally, public has none or very little to do with this orchestrated show where FED and banks try to delat inevitable chaos they have ahead. Look at all the new rulings ICC, DTC, etc has come up to cover their bottocks when the smelly thing hits the fan.
Dave Jones
Dave Jones Jun 28, 2021 10:21AM ET
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You can't make this stuff up....but somehow they do!
woomwoom woomwoom
woomwoom woomwoom Jun 28, 2021 9:43AM ET
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where is gone inflation concern? no more?
Joe Zhang
Joe Zhang Jun 28, 2021 9:43AM ET
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it will come back when they need money
CHADWICK RICHINGTON
CHADWICK RICHINGTON Jun 28, 2021 9:40AM ET
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Record highs every single day
Jun 28, 2021 9:40AM ET
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All the more reason to sit this one out
Gene Kret
Gene Kret Jun 28, 2021 8:55AM ET
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CHPT and SPWR 🚀🚀🚀🚀🚀
 
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