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Home / Business / Down more than 300 points as investors looking for stocks to be beaten, the S&P 500 is close to an all-time high

Down more than 300 points as investors looking for stocks to be beaten, the S&P 500 is close to an all-time high

Stocks rallied on Tuesday, with cyclical shares continuing to outpace previous high-tech stocks, while the S&P 500 hit an all-time high since February, almost complete. into a round trip from the plunge caused by the pandemic earlier this year.

What are the main indexes doing?

Dow Jones Industrial Average DJIA,
+ 1.02%
increased 305 points, or 1.1%, to 28,096, while the S&P 500 SPX,
+ 0.39%
increasing 16 points, or 0.5%, to 3,377. Nasdaq Composite COMP is technology-heavy,
lagging behind other benchmarks, down 15 points, or 0.1%, to 10,953.

+ 1.02%
on Monday up 357.96 points, or 1.3%, to end at 27,791.44, while the S&P 500 SPX,
+ 0.39%
up 9.19 points, or 0.3 percent, to close at 3,360.47, just 0.8 percent from the February 19 close of 3,386.15. Nasdaq Composite COMP,
Meanwhile, down 42.63 points, or 0.4%, ended at 10,968.36.

What leads the market?

Investors noted Monday’s plunge in high-tech stocks as industry, energy and other undervalued sectors rebounded. Some analysts have been looking for a strong short-term potential turnaround from popular growth-oriented stocks to more cyclical stocks once the worst signs of a pandemic are over. and the economy could move towards a fuller reopening.

Read:JP Morgan says do not expect this stock market value cycle to continue

“In our central scenario, we expect there will be no extended national lockdowns. “There must be moderate activities to control outbreaks moderately, with vaccines being widely available from the second quarter of 2021,” said Mark Haefele, investment director for global wealth management at UBS.

Combined with expansionary monetary policy and moderate fiscal stimulus, he said, would allow economic activity to be restored to pre-pandemic levels by 2022. With yields anchored close to the lows. The equity risk premium could normalize to pre-pandemic levels, allowing the S&P 500 to trade at 3,500 by the end of June 2021, Haefele said.

Dow’s gain in afternoon trading was driven by shares of JPMorgan Chase & Co. JPM,
+ 5.13%,
American Express Co. AXP,
+ 3.19%
and Boeing Co. FATHER,
+ 3.82%,
but to Apple Inc. AAPL,
Its biggest drag, represents an intraday shift from soaring tech stocks to stocks more closely tied to economic activity.

Sam Hendel, chairman and portfolio manager at Levin Easterly Capital, said in an interview, about the recent rally in the stock market away from some of the leading tech firms in stocks. benchmarks were higher, as the pandemic forced many fans to work from home.

“Technology has really shined,” he said, but added that a number of catalysts, including optimism around income recovery and the development and delivery of an effective vaccine, will be beneficial to constrained stocks in the long run.

According to a New York Times follower, the number of new COVID-19 infections in the US has dropped 18% in the past 14 days, while the number of deaths has fallen by 6%.

“In some important states (Arizona, California, Florida, Texas), the hospital bed utilization of COVID-19 patients is now clearly declining. This is an important trend that will limit reopening from a short-term reversal, ”the analysts at Macquarie wrote in a note.

However, they warn that the latest model update from the Institute of Health Metrology and Evaluation at the University of Washington points to increased risks in the fall. It found that 26 states had more than 1 in 40 chance of violating their special care unit’s capabilities on November 1, up from the 17 preceding states. Twelve other states risk doing so on December 1, they note.

Meanwhile, Russia has registered the world’s first COVID-19 vaccine, President Vladimir Putin said on Tuesday. The announcement marked a major milestone in the race to find a vaccine against the disease, but sparked international concern that Moscow was rushing to assess clinically the treatment.

See: Russia’s accelerated COVID-19 vaccine has been alarmed as experts say phase 3 testing is needed.

White House officials and top Democrats on Monday said they were ready to resume talks on the coronavirus aid package after President Donald Trump last week signed executive orders will expand some of the existing help factors that have expired by the end of July, although there are signs of little movement. Meanwhile, Trump’s order could run into legal and logistical hurdles.

However, investors appeared to have been interested in Trump’s remarks late on Monday, in which he said the administration was considering cutting capital gains tax.

Marios Hadjikyriacos, investment analyst at XM, said: “This is old news in a sense because Trump launched this idea before, but the market may have taken it more seriously this time because The president looks eager to get past the deadlocked Congress if he can, ”said Marios Hadjikyriacos, investment analyst at XM. in a musical note.

The National Federation of Independent Businesses said its Small Business Optimism Index fell to 98.8 in July, down 1.8 points from June. Economists surveyed by The Wall Street Journal expect a reading of 99.9.

The producer price index in July rose 0.6% in July. Economists surveyed by MarketWach had forecast an increase of 0.3%. Core PPI, which eliminates food and energy costs, increased by 0.3%.

Which companies to focus on?
  • Airline shares are on the rise, as traveler demand rebounded to its highest level since the pandemic began and positive comments from analysts. United Airlines Holdings Inc.
    + 1.97%
    stocks rose 2.8%, American Airlines Group Inc.
    + 2.71%
    increased 3.4% and Delta Air Lines Inc. FROM,
    + 4.27%
    stocks rose 4.3%.

  • Coupon of Canada Goose Holdings Inc.
    a 3.2% drop after the company reported growing losses and a sharp drop in revenue.

  • Casper Sleep Inc.
    Shares fell 4.3% after the company sold mattresses reporting narrower losses than expected in the second quarter.

  • Coupon of Uber technology. UBER,
    1% discount and Lyft Inc.
    + 1.17%
    It was up 0.6% after a California judge on Monday ruled that car-sharing companies had to classify their drivers as employees due to a new state law.

  • Airbnb Inc., another economic sharing firm, is poised to submit paperwork for a public listing later this month, laying the basis for a potential pre-year listing, The Wall Street Journal reported on Tuesday, citing people familiar with the matter.
  • Bearish financial sector shares rebounded as treasury bond yields rose, with SPDR ETF for the financial sector
    + 2.55%
    1.5% increase.

  • Qualcomm Inc. QCOM,
    + 4.25%
    shares were 4.2% higher after reporting that a US appeals court ruled antitrust against the chip maker.

What are other markets doing?

In Asian trade, China’s CSI 300 is 000300,
down 0.9%, while the Hang Seng Index of Hong Kong HSI,
+ 2.10%
increased 2.1% and Japan’s Nikkei 225 NIK index,
+ 1.88%
1.9% enhancement.

In Europe, European Index Stoxx 600 Europe SXXP,
+ 1.67%
and FTSE 100 UKX,
+ 1.61%
each increase by 1.7%.

Yield on 10-year Treasury Bond TMUBMUSD10Y,
rose 8 basis points to 0.65% as investors shunned the haven assets. Bond prices move against interest rates.

Gold GC00,
Tuesday withdrew from record territory, with contract after December down 4.6% to $ 1,946.30 an ounce. Crude oil is flat, with US standard futures CL.1,
trading at around 41.92 USD / barrel.

The greenback is down 0.1%, with the ICE US Dollar Index DXY,
a measure of money against a half-dozen major rivals, at 93.52.

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