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S&P 500 Ends Well Above Lows on Chip-Led Rebound in Tech

Stock Markets May 19, 2021 04:17PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com –The S&P 500 ended lower Wednesday, but cut losses into the close as a chip-led rebound in tech helped soothe concerns the Federal Reserve is starting to think about broaching the bond tapering topic at upcoming meetings.

The S&P 500 fell 0.81%, the Dow Jones Industrial Average fell 0.49%, or 341 points, and the Nasdaq Composite slipped 0.49%.

The Federal Reserve minutes from its April meeting served up the first signs that some central bank members are ready to start thinking about tapering.  

"A number of participants suggested that if the economy continued to make rapid progress toward the Committee's goals, it might be appropriate at some point in upcoming meetings to begin discussing a plan for adjusting the pace of asset purchase," the minutes showed.

The minutes exacerbated the selloff, and appeared to cut short the rebound in tech as U.S. government bond yields jumped.

But buying returned to the big cap and chip stocks, helping to steady the overall sector.

The iShares PHLX Semiconductor ETF (NASDAQ:SOXX) was up more than 1%, led by Marvell Technology (NASDAQ:MRVL), II-VI (NASDAQ:IIVI) and Analog Devices (NASDAQ:ADI) leading the charge.

Analog Devices Inc (NASDAQ:ADI) climbed 5% after reporting first-quarter results that topped analysts' estimates.

Apple (NASDAQ:AAPL), Facebook (NASDAQ:FB), and Microsoft (NASDAQ:MSFT), Google-parent Alphabet (NASDAQ:GOOGL) and Amazon.com (NASDAQ:AMZN) were well off their intraday lows.

The dip-buying in tech, however, appears to come at the expense of the economically-sensitive cyclicals in corners of the market like energy, financials and materials.

Energy was among biggest losers on the day as oil prices fell more than 2% despite data showing a smaller-than-expected build in weekly U.S. crude stocks.

Crude oil stockpiles rose by 1.3 million barrels for the week to May 14, a lower build than the 1.6 million barrels economists had forecast.

On the earnings front, Take-Two Interactive Software (NASDAQ:TTWO) reported fiscal fourth-quarter results that topped Wall Street estimates, sending its share price up more than 5%.

Target (NYSE:TGT) was also up more than 5% after its first-quarter results beat on both the top and bottom lines.

In the midst of the selloff in crypto that has since abated - sparked by a regulatory crackdown on Bitcoin in China and broader risk-off sentiment in crypto markets during recent days - stocks including Tesla (NASDAQ:TSLA), Square (NYSE:SQ) and MicroStrategy (NASDAQ:MSTR) were under pressure.

S&P 500 Ends Well Above Lows on Chip-Led Rebound in Tech
 

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Comments (9)
Bipin Kochar
Bipin Kochar May 19, 2021 7:14PM ET
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The weak job report clearly highlights that the economy has not yet recovered to the extent needed and Fed bond purchases need to continue
Atlantic Coast Money
Atlantic Coast Money May 19, 2021 7:14PM ET
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Bond purchases are not helping the economy. They are only helping the stock market. Very manipulative. Filling pockets of the top 1%. Also being done to keep pension funds able to support boomers. Trickle down economics are a falsehood. Let market finds its equilibrium. Allow zombie companies to perish. Defund the Fed.
Steve Lora
Steve Lora May 19, 2021 6:33PM ET
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Biden not doing much as president. He's weak.
New Jazenevd
New Jazenevd May 19, 2021 6:33PM ET
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Rather stupid than weak
Leon Kelly
Leon Kelly May 19, 2021 6:30PM ET
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Last hour was a fools rally... The Dip is dead. Be careful bulls.
Casino Crypt
CasinoCrypt May 19, 2021 6:21PM ET
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The markets have data points tied to the 10 treasury. I don't see any evidence of company results driving price action across the broader markets .
Adam Paine
Adam Paine May 19, 2021 6:07PM ET
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"Analyists" always shoot way low and then act surprised. total set up. Then, if they know it will be bad, they won't even give a consensus. Who are these "Analyists" Paid hedge fund bull writers
Finanically Ruined
Finanically Ruined May 19, 2021 6:00PM ET
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Day was miracously saved....Shocker
Javier Escamilla
Javier Escamilla May 19, 2021 5:49PM ET
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To the moon! Lol
Mitchel Pioneer
Mitchel Pioneer May 19, 2021 4:58PM ET
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Another joke of a day in the greatest financial fraud in the world.
John Whitfield
John Whitfield May 19, 2021 4:37PM ET
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no mention of AMD. smh obvious.
 
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