S&P 500 and Nasdaq close slightly higher, led by tech shares
The S&P 500 and Nasdaq Composite closed slightly higher on Wednesday, led by tech shares, as traders kept an eye on interest rates, the political uncertainty coming out of Washington and a still raging pandemic.
The broader market index gained 0.2% to end the day at 3,809.84, and the tech-heavy Nasdaq advanced 0.4% to 13,128.95. The Dow Jones Industrial Average closed just 8.22 points lower, or 0.03%, at 31,060.47.
Intel jumped nearly 7% on news that CEO Bob Swan would step down, effective Feb. 15. Other tech-related names also caught a bid, with Netflix and Amazon popping 2.7% and 1.4%, respectively. Apple also closed higher by more than 1%.
Wednesday’s moves came as U.S. Treasury rates eased from their March highs. The benchmark 10-year note yield fell more than 5 basis points to 1.092%. The 30-year bond yield also fell on Wednesday to 1.823%. On Tuesday, the benchmark rate traded as high as 1.187%.
Despite this decline, the 10-year rate remains more than 15 basis points above its 2020 close of 0.92%.
“Overall, we believe the rate backdrop will stabilize as investors acclimate to the shift in inflation expectations,” wrote UBS credit strategist Frank Sileo in a note. “We continue to expect modest gains in 2021.”
Still, many say the U.S. is poised to return to growth later this year.
“In 2021, the U.S. economy should experience strong tailwinds from additional fiscal and monetary stimulus coupled with an end to the pandemic’s impact on the economy,” said Brent Schutte, chief investment strategist for Northwestern Mutual Wealth Management. “Pent-up demand in industries impacted by COVID-19 ... and a needed inventory rebuild should further spur job growth,” he added.
Taken together, Schutte said this sets the stage for above-average economic growth, and he sees stocks climbing to new highs.
Stock futures open higher following Wednesday’s slight gains
U.S. stock futures rose on Wednesday night as traders kept an eye on interest rates and lingering turmoil in Washington.
Dow Jones Industrial Average futures traded 46 points higher, or 0.1%. S&P 500 futures gained 0.2%, and Nasdaq 100 futures advanced 0.1%.
Reference: CNBC
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