S&P 500 scales new record high on tech boost
The S&P 500 hit a record peak on Thursday, helped by gains in tech-related stocks as weaker-than-expected jobless claims data bolstered the Federal Reserve’s stance to keep interest rates lower for a longer period.The industrials, materials and healthcare sectors weighed the most on the S&P 500.
Apple Inc, Microsoft Corp, Alphabet Corp and Amazon.com Inc rose between 1% and 1.5% and were among the top boosts to the benchmark index.
High-growth tech stocks have recovered in recent sessions as U.S. 10-year bond yield backed off from its 14-month peak, pushing the tech-heavy Nasdaq to a seven-week high and within 2% of its record closing high.
Latest data showed the number of Americans filing new claims for unemployment benefits unexpectedly rose last week, but the increase likely understates the rapidly improving labor market conditions.
“While states balance the vaccine rollout with stop and start reopening plans, the labor market continues to feel the heat,” said Mike Loewengart, managing director of investment strategy at E*TRADE Financial.
“But the disappointing read actually puts some firepower behind the Fed’s accommodative stance.
The Fed acknowledged the economy was on its path to a strong rebound backed by massive fiscal spending and accelerating vaccinations, minutes released on Wednesday showed.
However, the central bank noted it would be “some time” before conditions improve enough for the Fed to rein in its support.
Fed Chair Jerome Powell will speak at a virtual International Monetary Fund event at 1200 ET (1600 GMT).
The tech sector hit a record high, while economy-linked financials, industrials, materials and energy fell the most among major S&P sectors.
The Russell 1000 growth index, which consists of tech-related stocks, gained about 1%, while its value counterpart, comprising mostly financials and energy names, dropped about 0.3%.
At 11:31 a.m. ET the Dow Jones Industrial Average rose 1.04 points, or 0.00% , to 33,447.30, the S&P 500 gained 13.09 points, or 0.32 %, to 4,093.04 and the Nasdaq Composite gained 117.70 points, or 0.86%, to 13,806.54.The sharp run up in earnings expectations could set up for disappointment, a market expert said.
JPMorgan Chase & Co Chief Executive Officer Jamie Dimon said the United States could be in store for an economic boom through 2023 if more adults get vaccinated and federal spending continues.
At 11:47 a.m. EDT the Dow Jones Industrial Average fell 52.86 points, or 0.16% , to 33,377.38, the S&P 500 lost 1.02 points, or 0.03 %, to 4,072.92 and the Nasdaq Composite lost 15.45 points, or 0.11 %, to 13,682.93.
Prison operator GEO Group fell about 19% after suspending quarterly dividend payments.
Declining issues outnumbered advancers by a 1.7-to-1 ratio on the NYSE and by a 2.4-to-1 ratio on the Nasdaq.
The S&P 500 posted 28 new 52-week highs and no new lows, while the Nasdaq recorded 93 new highs and 20 new lows.