The News Herald (Willoughby, OH)
Tech gains help stocks end quarter with a bang
Stocks soared as Wall Street ended its most volatile quarter in more than two years with a broad-based rally.
Technology and consumer-focused stocks soared Thursday as Wall Street ended its most volatile quarter in more than two years with a broad-based rally.
Banks and industrial stocks also lifted the market and recent laggards such as Facebook and Boeing rose. Even so, the solid gains, which came at the end of a holiday-shortened week, couldn’t prevent the stock market’s first quarterly loss since the third quarter of 2015.
After two years of slow-andsteady growth the market started 2018 with a roar. Then the market plunged in early February, marking its first 10 percent drop in two years, as investors worried the Federal Reserve would accelerate the pace of interest rate increases. In the weeks since, the market has remained volatile and trading has frequently turned choppy, with concerns over trade disputes a key factor.
At the end of a quarter that featured many dramatic swings — the market had 23 days where it closed up or down 1 percent or more — the Dow Jones industrials were down 2.5 percent while the S&P 500 was down 1.2 percent.
Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, said the market’s first-quarter performance has tempered expectations for the rest of the year after the strong start in January.
“Volatility has ramped up, inflationary pressures are more prevalent, interest rates are on the cusp of change, so that presents a higher level of uncertainty and higher investor angst,” Sandven said.
That angst was tempered on Thursday. The S&P 500 rose 35.87 points, or 1.4 percent, to 2,640.87. The Dow gained 254.69 points, or 1.1 percent, to 24,103.11. The blue chip average was briefly up 465 points. The Russell 2000 index of smaller-company stocks picked up 16.40 points, or 1.1 percent, to 1,529.43.
The Nasdaq added 114.22 points, or 1.6 percent, to 7,063.44 and closed the quarter with a gain of 2.3 percent.
The major indexes were headed higher from the start of trading Thursday as investors sized up several company earnings reports and new government data showing that spending by U.S. consumers rose 0.2 percent in February, while their incomes increased 0.4 percent. The healthy income gains could spur more spending in the coming months.
Technology stocks, which were big decliners earlier in the week, powered much of the market’s climb Thursday.
Facebook was among the gainers, its shares adding 4.4 percent. The social media giant, which has taken a beating in recent days over privacy concerns, rose $6.76 percent, to $159.79.
Even with the roller-coaster ride that technology stocks have been on lately, the sector is up 3.2 percent this year, while most other sectors are in the red.
Thursday’s run-up in technology stocks signaled that investors believe the sector was oversold in recent weeks, said Sandven, adding that perhaps some of it can be explained by fund managers padding portfolios with stocks to elevate their quarter-end results, what Wall Street calls “windowdressing.”
Shares in several companies that reported improved quarterly earnings or outlooks got a boost.
PVH, which owns Calvin Klein and Tommy Hilfiger, climbed $7.41, or 5.1 percent, to $151.43, while beverage maker Constellation Brands rose $7.43, or 3.4 percent, to $222.92.
Solid results and a betterthan-expected outlook also gave Movado Group shares a lift. The watchmaker’s stock jumped $5.20, or 15.7 percent, to $38.40.
Some companies had a rough day, even after delivering strong quarterly results.
Gamestop slumped 10.8 percent after the retailer issued a disappointing full-year revenue and earnings outlook, which overshadowed fourth-quarter results that beat Wall Street’s expectations. The stock slid $1.53 to $12.62.