• The Star Staff

Wall St rebounds on tech boost after fewer jobless claims data

Wall Street lost ground on Tuesday as rising commodity prices and labor shortages fueled fears that, despite reassurances from the U.S. Federal Reserve, near-term price spikes could translate into longer-term inflation.


By late afternoon the indexes were off their session lows, but the sell-off was fairly evenly dispersed across the sectors.


Economic data released on Tuesday from the Labor Department showed job openings at U.S. companies jumped to a record high in March, further evidence of the labor shortage hinted by Friday’s disappointing employment report.


The report suggests labor supply is not keeping up with surging demand as employers scramble to find qualified workers.


Burrito chain Chipotle Mexican Grill announced it would hike the average hourly wage of its workers to $15, a further sign that the worker shortage in the face of a demand revival could add fuel to the inflation surge.“One number doesn’t make a trend, but it takes some of the heat off the economy overheating and inflation moving dramatically higher,” said Larry Adam, chief investment officer at Raymond James.


The U.S. economy is poised to boom as consumers hold $2 trillion in savings in excess of what they held before the pandemic, said Doug Peta, chief U.S. investment strategist at BCA Research, adding markets are in pause mode.


“If indeed we do keep grinding higher that would be healthy, that would suggest that the grinding higher is sustainable,” Peta said. “The pullbacks along the way are healthy.”


By 1:44 p.m. ET, the Dow Jones Industrial Average fell 150.4 points, or 0.44%, to 34,050.27, the S&P 500 lost 24.91 points, or 0.60%, to 4,160.56 and the Nasdaq Composite dropped 148.69 points, or 1.06%, to 13,903.66.


Coca-Cola Co rose 0.35% after the beverage maker trounced estimates for quarterly profit and revenue, benefiting from the easing of pandemic curbs and wide vaccine rollouts.


International Business Machines Corp, another blue-chip company, slipped about 0.22% ahead of its results after market close.


“The market has had a huge jump to the upside so it needs to take a little bit of rest,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.


“For now it’s just a little bit of profit taking as traders await results from big tech names on Wall Street.”


A recent retreat in benchmark 10-year Treasury yields from 14-month highs has renewed interest in highly valued technology stocks, while a string of strong economic data has also helped push the S&P 500 and the Dow to record levels.


The S&P 500 has gained the past four weeks, its longest winning streak since August 2020.

GameStop Corp jumped 6.41% on the announcement of its CEO’s resignation.


Crypto stocks including miners Riot Blockchain and Marathon Digital each slumped about 11% each as bitcoin took a hammering.

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