US STOCKS-S&P closes at record on tech boost as U.S. Treasury yields retreat

Megacap stocks such as Apple , Microsoft and Amazon were the biggest boosts to the S&P 500. The gains sent the tech-heavy Nasdaq to a seven-week high and within 2% of its Feb. 12 record closing high.

Reuters | Washington DC | Updated: 09-04-2021 09:22 IST | Created: 09-04-2021 01:53 IST
US STOCKS-S&P closes at record on tech boost as U.S. Treasury yields retreat
Representative Image Image Credit: Pixabay

The S&P 500 closed at a record high on Thursday, as U.S. Treasury yields fell following softer-than-anticipated labor market data, boosting technology and other growth stocks. Weekly initial jobless claims data showed a second straight rise, conflicting with the recent payrolls report, and buttressed the Federal Reserve's dovish policy stance to keep interest rates lower for a substantial period.

Federal Reserve Chair Jerome Powell signaled on Wednesday the central bank is nowhere near reducing support for the U.S. economy, saying an expected rise in prices this year is likely to be temporary. The softer data helped yields on the benchmark 10-year U.S. Treasury note fall as low as 1.624%, its lowest level since March 26, as it continues to back away from a 14-month high of 1.776% hit in late March.

"Wall Street rewards growth, that doesn't mean value names will never go up, they will go up because they have more growth prospects than their neighbors, that is what this whole thing is predicated on," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh. "It was kind of ridiculous that bond yields were preceding runaway inflation and that was not the case, so tech lives another day."

The Dow Jones Industrial Average rose 57.31 points, or 0.17%, to 33,503.57, the S&P 500 gained 17.22 points, or 0.42%, to 4,097.17 and the Nasdaq Composite added 140.47 points, or 1.03%, to 13,829.31. The recent pullback in yields has helped high growth names such as those in technology, the sector that posted the session's biggest rise. Megacap stocks such as Apple, Microsoft and Amazon were the biggest boosts to the S&P 500.

The gains sent the tech-heavy Nasdaq to a seven-week high and within 2% of its Feb. 12 record closing high. The Russell 1000 growth index, which consists heavily of tech-related stocks, gained 1.05%. Its value counterpart , comprising mostly financials and energy names, edged 0.05% lower.

Trading activity has tapered off, with the four lowest volume days of the year occurring this week ahead of first-quarter earnings season next week with results from big U.S. banks on tap. Analysts have raised expectations for first-quarter S&P 500 earnings increase to 24.2%, according to Refinitiv IBES data as of April 1, versus 21% forecast on Feb. 5. Tesla Inc advanced 1.91% on the Joe Biden administration's $174 billion proposal to boost electric vehicles.

U.S. shares of Canopy Growth Corp dropped 4.81% on a deal to buy rival Supreme Cannabis Co Inc for C$323.3 million ($256.9 million), as the world's biggest cannabis producer bolstered its portfolio to tap surging demand. Advancing issues outnumbered declining ones on the NYSE by a 1.80-to-1 ratio; on Nasdaq, a 2.13-to-1 ratio favored advancers.

The S&P 500 posted 36 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 77 new highs and 29 new lows. Volume on U.S. exchanges was 9.23 billion shares, compared with the 11.93 billion average for the full session over the last 20 trading days.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)



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