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The Dow and the S&P 500 closed at record highs on Friday as investors poured money into cyclical stocks poised to benefit from the economic recovery this year. However, the Nasdaq ended in the red, as surge in long-term bond yield to a one-year high revived inflation worries and restricted trade in relatively higher valued tech stocks.
The Dow Jones Industrial Average (DJI) rose 293.05 points, or 0.9%, to close at 32,778.64 and the S&P 500 rose 4 points, or 0.1%, to close at 3,943.34. The Nasdaq Composite Index closed at 13,319.86, declining 78.81 points, or 0.6%. The fear-gauge CBOE Volatility Index (VIX) decreased 5.6%, to close at 20.69. Advancing issues outnumbered declining ones for 1.24-to-1 ratio on the NYSE and a 1.14-to-1 ratio on the Nasdaq favored advancers.
How Did the Benchmarks Perform?
The Dow hit another all-time high on Friday and maintained its northward trend for fifth day in a row. Among the blue-chip index’s highest gainers were The Boeing Company (BA - Free Report) , Caterpillar Inc. (CAT - Free Report) and Walgreens Boots Alliance, Inc. (WBA - Free Report) that closed 6.8%, 4.2% and 3.3% higher for Friday’s session. Caterpillar holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Nasdaq closed in the red on Friday as investors moves out of tech stocks after bond yield hit a one-year high. Additionally, tech shares came under pressure after China’s market regulator said it had imposed fines on some of America’s largest tech firms. And, President Joe Biden informed some suppliers to China’s Huawei Technologies of tighter conditions on previously approved export licenses, prohibiting items for use in or with 5G devices, per a Bloomberg report.
Shares of companies that benefited from work-from-home practices during the pandemic, mostly technology and internet stocks fell on Friday. DocuSign, Inc. (DOCU - Free Report) and JD.com, Inc. (JD - Free Report) witnessed at least 6.5% decline, followed by nearly 5% decline in shares of Peloton Interactive, Inc. (PTON - Free Report) and Okta, Inc. (OKTA - Free Report) .
Of the 11 major sectors of the S&P 500, nine ended in the positive territory. The real estate, industrials, utilities and financials sectors closed at least 1.1% higher. On Friday, the S&P 500 posted 83 new 52-week highs and no new lows, while the Nasdaq Composite recorded 396 new highs and 12 new lows.
10-Year Treasury Yield Hits One-Year High
On Friday, the yield on the 10-year benchmark note hit 1.642%, jumping nearly 10 basis points and the highest level since last year February. The benchmark rate has begun the year nearly at 0.92%. This jump in bond yield renewed valuation fears among investors and restricted trade in tech stocks that had lifted Nasdaq on Thursday. The broader index and the blue-chip Dow however maintained its momentum as optimism on economic reopening encouraged investors to put money into cyclical stocks.
Bank stocks gained amid rising rates and share of The Goldman Sachs Group, Inc. (GS - Free Report) and JPMorgan Chase & Co. (JPM - Free Report) closed nearly 2% and 1.2% higher, respectively.
Producer Price Index Rise in Line with Estimates
The Labor Department reported on Mar 12 that the producer price index (PPI) rose 0.5% in February, in line with the consensus estimate. However, the figure is lower than January’s 1.3% rise, which was the biggest gain since 2009. Core PPI which excludes volatile food and energy prices, rose 0.3%, also in line with the consensus estimate. On an annualized basis, PPI advanced 2.8%, while Core PPI rose 2.2%.
Upbeat Consumer Sentiment in March
On Friday, the University of Michigan reported that the initial reading of its consumer sentiment index jumped to 83 in March, beating the consensus estimate of 78.6. March’s preliminary reading is the highest since the economy went into lockdown due to the pandemic and surpassed the previous month’s reading of 76.8. As per the report, anticipation of $1,400 stimulus checks as a part of Biden’s relief package fueled consumer sentiments. Additionally, decrease in the number of COVID-19 cases and more American getting vaccinated also played a part in boosting sentiments.
Weekly Roundup
For the week ending Mar 12, the Dow, the S&P 500 and the Nasdaq gained 4.1%, 2.6% and 3.1%, respectively. The Dow hit consecutive record highs last week and the S&P 500 and Nasdaq posted their biggest weekly percentage gains since early February. The momentum in the stock market was accredited by Biden’s $1.9 trillion coronavirus relief package, drop in COVID-19 cases and advancement in vaccination across the country.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Image: Bigstock
Stock Market News for Mar 15, 2021
The Dow and the S&P 500 closed at record highs on Friday as investors poured money into cyclical stocks poised to benefit from the economic recovery this year. However, the Nasdaq ended in the red, as surge in long-term bond yield to a one-year high revived inflation worries and restricted trade in relatively higher valued tech stocks.
The Dow Jones Industrial Average (DJI) rose 293.05 points, or 0.9%, to close at 32,778.64 and the S&P 500 rose 4 points, or 0.1%, to close at 3,943.34. The Nasdaq Composite Index closed at 13,319.86, declining 78.81 points, or 0.6%. The fear-gauge CBOE Volatility Index (VIX) decreased 5.6%, to close at 20.69. Advancing issues outnumbered declining ones for 1.24-to-1 ratio on the NYSE and a 1.14-to-1 ratio on the Nasdaq favored advancers.
How Did the Benchmarks Perform?
The Dow hit another all-time high on Friday and maintained its northward trend for fifth day in a row. Among the blue-chip index’s highest gainers were The Boeing Company (BA - Free Report) , Caterpillar Inc. (CAT - Free Report) and Walgreens Boots Alliance, Inc. (WBA - Free Report) that closed 6.8%, 4.2% and 3.3% higher for Friday’s session. Caterpillar holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Nasdaq closed in the red on Friday as investors moves out of tech stocks after bond yield hit a one-year high. Additionally, tech shares came under pressure after China’s market regulator said it had imposed fines on some of America’s largest tech firms. And, President Joe Biden informed some suppliers to China’s Huawei Technologies of tighter conditions on previously approved export licenses, prohibiting items for use in or with 5G devices, per a Bloomberg report.
Shares of companies that benefited from work-from-home practices during the pandemic, mostly technology and internet stocks fell on Friday. DocuSign, Inc. (DOCU - Free Report) and JD.com, Inc. (JD - Free Report) witnessed at least 6.5% decline, followed by nearly 5% decline in shares of Peloton Interactive, Inc. (PTON - Free Report) and Okta, Inc. (OKTA - Free Report) .
Of the 11 major sectors of the S&P 500, nine ended in the positive territory. The real estate, industrials, utilities and financials sectors closed at least 1.1% higher. On Friday, the S&P 500 posted 83 new 52-week highs and no new lows, while the Nasdaq Composite recorded 396 new highs and 12 new lows.
10-Year Treasury Yield Hits One-Year High
On Friday, the yield on the 10-year benchmark note hit 1.642%, jumping nearly 10 basis points and the highest level since last year February. The benchmark rate has begun the year nearly at 0.92%. This jump in bond yield renewed valuation fears among investors and restricted trade in tech stocks that had lifted Nasdaq on Thursday. The broader index and the blue-chip Dow however maintained its momentum as optimism on economic reopening encouraged investors to put money into cyclical stocks.
Bank stocks gained amid rising rates and share of The Goldman Sachs Group, Inc. (GS - Free Report) and JPMorgan Chase & Co. (JPM - Free Report) closed nearly 2% and 1.2% higher, respectively.
Producer Price Index Rise in Line with Estimates
The Labor Department reported on Mar 12 that the producer price index (PPI) rose 0.5% in February, in line with the consensus estimate. However, the figure is lower than January’s 1.3% rise, which was the biggest gain since 2009. Core PPI which excludes volatile food and energy prices, rose 0.3%, also in line with the consensus estimate. On an annualized basis, PPI advanced 2.8%, while Core PPI rose 2.2%.
Upbeat Consumer Sentiment in March
On Friday, the University of Michigan reported that the initial reading of its consumer sentiment index jumped to 83 in March, beating the consensus estimate of 78.6. March’s preliminary reading is the highest since the economy went into lockdown due to the pandemic and surpassed the previous month’s reading of 76.8. As per the report, anticipation of $1,400 stimulus checks as a part of Biden’s relief package fueled consumer sentiments. Additionally, decrease in the number of COVID-19 cases and more American getting vaccinated also played a part in boosting sentiments.
Weekly Roundup
For the week ending Mar 12, the Dow, the S&P 500 and the Nasdaq gained 4.1%, 2.6% and 3.1%, respectively. The Dow hit consecutive record highs last week and the S&P 500 and Nasdaq posted their biggest weekly percentage gains since early February. The momentum in the stock market was accredited by Biden’s $1.9 trillion coronavirus relief package, drop in COVID-19 cases and advancement in vaccination across the country.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>