Tech stocks help lead re­bound

The Norwalk Hour - - BUSINESS -

Tech­nol­ogy shares that led the long­est rout in U.S. stocks in al­most two years bounced back Fri­day to power ma­jor in­dexes higher. A fourth straight day of Trea­sury gains sent banks tum­bling to the low­est since Novem­ber.

The S&P 500 pared the worst weekly drop since March with a gain that hov­ered near 0.7 per­cent in the fi­nal hour of a wild ses­sion, with trad­ing 35 per­cent above av­er­age. The in­dex all but erased a rally that reached 1.7 per­cent, only to bounce higher af­ter JPMor­gan an­a­lysts said that sell­ing forced by com­pu­t­er­driven strate­gies had likely run its course. Volatil­ity ruled, though, with the in­dex mak­ing an­other run at wip­ing out the gain be­fore re­sum­ing its march higher.

Tech­nol­ogy buoyed all the ma­jor av­er­ages, with the Nas­daq 100 In­dex ris­ing more than 2 per­cent just two days af­ter its worst rout since 2011. Net­flix Inc. ral­lied 5 per­cent amid an “op­por­tunis­tic up­grade” from an­a­lysts at Cit­i­group Inc. Ac­tivi­sion Bl­iz­zard drove gains in gam­ing shares af­ter re­leas­ing a new ver­sion of “Call of Duty.” The 10-year Trea­sury yield fell a fourth day, to 3.14 per­cent. That weighed on banks even af­ter mostly pos­i­tive earn­ings re­ports from JPMor­gan Chase & Co., Cit­i­group Inc. and Wells Fargo & Co. The group is down al­most 6 per­cent in the week.

The rea­sons for Fri­day’s rally were as var­ied as for the week­long pound­ing. Trade data from China helped ease con­cerns about global growth, while signs emerged of re­lax­ing trade ten­sions with the U.S. amid a planned meet­ing be­tween the coun­tries in Novem­ber and the Trea­sury De­part­ment’s de­ter­mi­na­tion that China isn’t ma­nip­u­lat­ing its cur­rency. Re­lief that the bank earn­ings weren’t bad cooled anx­i­ety that cor­po­rate prof­its might not live up to lofty ex­pec­ta­tions amid higher costs from the Trump tar­iffs.

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