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Nasdaq finishes higher, tech stocks retrace some losses

Stock MarketsFeb 26, 2021 04:35PM ET
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2/2 © Reuters. A statue of George Washington is seen on Wall St. across from the NYSE is seen in New York 2/2

By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters) - The tech-heavy Nasdaq index rallied in choppy trading on Friday, even as sentiment remained fragile after the index's worst performance in four months the day before as fears of rising inflation kept U.S. bond yields near a one-year high.

The S&P 500 ended little changed, while the Dow index closed lower after earlier dropping to a three-week low. The Dow still posted gains of nearly 4% for the month, as investors bought into cyclical companies set to benefit from an economic reopening.

Nasdaq, which had its worst week since October, ended the month roughly 1% higher while the S&P 500 posted a monthly gain of about 2.6%.

Shares of Apple Inc (NASDAQ:AAPL), Amazon.com Inc (NASDAQ:AMZN), Microsoft Corp (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOGL) Inc rose between 0.2% to 1.4% on Friday but had their worst week in months due to a sharp rise in U.S. Treasury yields.

The benchmark 10-year U.S. Treasury yield eased to 1.404% after jumping to 1.614% on Thursday, roiling stock markets. [US/] Wall Street's fear gauge hovered at a one-month high.

Tech stocks are particularly sensitive to rising yields because their value rests heavily on future earnings, which are discounted more deeply when interest rates go up.

"There's no question that the path in rates today is higher," said Andrew Mies, chief investment officer at 6 Meridian.

The Dow Jones Industrial Average closed 469.64 points lower, or 1.5%, to 30,932.37, the S&P 500 lost 18.19 points, or 0.48%, to 3,811.15 and the Nasdaq Composite added 72.91 points, or 0.56%, to 13,192.34.

Financials and energy shares, the best performing S&P sectors this month, slipped 2% and 2.3% on Friday. Technology stocks rose 0.6% and semiconductor stocks advanced 2.3%.

"There are a few tailwinds for stocks that we shouldn't lose sight of," Mies said, citing President Joe Biden's $1.9 trillion economic aid package before Congress.

The S&P 500 value index dropped 1.3% while the growth index rose 0.3% in a reversal of this month's trend.

An early surge in the shares of GameStop Corp (NYSE:GME) fizzled and left the video game retailer's stock down 6.4% on Friday, throwing water on a renewed rally this week that has left analysts puzzled.

On the economic front, the latest data showed U.S. consumer spending increased by the most in seven months in January but price pressures remained muted.

Salesforce.com Inc (NYSE:CRM) dropped 6.3% as the online software company forecast full-year profit below market expectations.

Volume on U.S. exchanges was 15.54 billion shares on Friday, compared with the 15.40 billion average for the full session over the last 20 trading days.

Declining issues outnumbered advancing ones on the NYSE by a 1.56-to-1 ratio; on Nasdaq, a 1.73-to-1 ratio favored decliners.

The S&P 500 posted four new 52-week highs and one new low; the Nasdaq Composite recorded 54 new highs and 50 new lows.

Nasdaq finishes higher, tech stocks retrace some losses
 

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Comments (6)
Casador Del Oso
Casador Del Oso Feb 26, 2021 1:34PM ET
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Dead cat bounce?
Mehmet Dutlu
Mehmet Dutlu Feb 26, 2021 1:34PM ET
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The cat is not yet dead. Not even close.
Cal Lowe
Cal Lowe Feb 26, 2021 1:02PM ET
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Time to load up those stocks
Jesse James
Jesse James Feb 26, 2021 12:00PM ET
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cmon man biden gonna fix everything.
Steve Lora
Steve Lora Feb 26, 2021 11:37AM ET
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Biden has set us back to the Obama shovel ready jobs era. EBT in chief..gas will be $4 soon
Mark Jo
Mark Jo Feb 26, 2021 11:29AM ET
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It's call reflation for god sakes! Does those people have a degree in ecoonomy. The purpose of stimulus package is to bring back the inflation to the level it was before the crisis. We are not even there yet. We are nowhere close to hyperinflation.
Jimmy Tsang
Jimmy Tsang Feb 26, 2021 10:53AM ET
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US is still in recession and nowhere close to any kind of inflation, reporters should not spread false news and make people panic
Hong Ee Leow
Hong Ee Leow Feb 26, 2021 10:53AM ET
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it's just inflation expectations, not saying inflation has risen substantially right now. but still, investors have to be wary as there are many telltale signs of impending inflation such as rising yields, excessive dollar printing, equity selloff.
Steve Lora
Steve Lora Feb 26, 2021 10:53AM ET
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Thats comical "Reporters should not soread false..." lol Media are part of the socialist democrat party that's 95% communist
 
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