Tech stocks rally, helping to buoy Wall Street
Wall Street was split on Monday as continued gains for technology and health care stocks helped cover up for more prevalent losses elsewhere.
The S&P 500 ended the day at a virtual standstill, up just 0.52 points at 2,930.19, despite a lot of movement going on underneath. It rallied back from an earlier loss of 0.9% in the morning.
The Dow Jones Industrial Average fell 109.33 points, or 0.4%, to 24,221.99, while the Nasdaq composite added 71.02, or 0.8%, to 9,192.34.
Through the muddled day, one of the market’s few points of clarity was that investors continue to love technology stocks.
Even with the coronavirus pandemic throwing the global economy into disarray, tech stocks in the S&P 500 have been remarkably resilient. They’re up 4.1% for 2020 as investors look for companies that can be winners in both a “normal” and a stay-at-home economy.
Apple rose 1.6%, Nvidia added 3.2% to return to a record, and Advanced Micro Devices climbed 4.8% for one of Monday’s biggest gains in the S&P 500.
This year’s second-best sector has been health care, which has trimmed its loss for 2020 to just 1%.
Biotech stocks were particularly strong Monday. And Cardinal Health had the biggest gain in the S&P 500, up 6.7%, after reporting stronger-than-expected earnings for its latest quarter, partly because of increased pharmaceutical sales due to the pandemic.
Those gains helped to make up for 69% of stocks falling in the S&P 500.
“People are looking ahead, and they’re saying, ‘OK, the pandemic has happened, and the damage has swept through our economy and our businesses, and now we’re planning on the growth after the carnage, so we’re valuing equities as if we’re going to go back to a decent growth environment,’ ” said Mike Zigmont, head of trading and research at Harvest Volatility Management.
The S&P 500 has rallied 31% since late March, at first on relief after the Federal Reserve and Capitol Hill pledged massive amounts of aid for the economy.