Tech stocks power S&P 500 up to record
NEW YORK — The S&P 500 ticked higher to close at another all-time high Friday, powered by strength for technology stocks and a couple reports on the U.S. economy that were better than expected.
The benchmark index rose 11.65 points, or 0.3 percent, to 3,397.16, even though the majority of stocks in the index weakened. It followed up on losses across Europe after more discouraging reports there indicated a slowdown in its economies.
The S&P 500 surpassed its prior closing high of 3,389.78, which was set on Tuesday after the index erased the last of its historic losses from the coronavirus pandemic. Despite its record-setting week, the market’s momentum has slowed recently after roaring back from its nearly 34 percent plunge from late February into March.
Investors are still waiting for more clarity on several fronts, which could drive the next big move up or down.
The economy has shown some signs of stalling recently, with Friday’s
reports from Europe the latest reminder that a steady rise in coronavirus cases may be undermining growth. They follow a U.S. report from Thursday that showed that the number of workers applying for unemployment benefits picked up last week.
But the picture remains mixed. A separate report from IHS Markit on Friday said preliminary data suggests output from the U.S. private sector is at an 18-month high. Sales of previously occupied homes were also stronger in July than economists expected, as activity exploded in every region of the country.
Those reports helped the U.S. stock market recover from declines earlier in the morning.
Tech has remained remarkably resilient through the pandemic and continued to churn out big profits as work-from-home and other tech-friendly trends accelerate. Apple, which this week became the first U.S. company to have a market value of more than $2 trillion, rose 5.2 percent.
Big tech stocks, which generally have strong balance sheets and deliver strong growth, will likely continue to be attractive to investors as long as there are questions about economic growth, said Quincy Krosby, chief market strategist at Prudential Financial.
“One of the most important factors in this market and for the broadening of the market in order to include those names that have not participated is: You want to see the unemployment landscape heal, and you want to see those initial unemployment claims come down,” she said. “That’s a major focus for analysts because we’re a consumer-led economy. People need jobs in order to consume.”