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Technology shares staged a recovery on Tuesday, lifting benchmarks higher. Both the Dow and the S&P 500 closed at record levels. Shares of major technology companies including Apple, Google’s parent Alphabet, Microsoft, Facebook and Amazon rebounded helping Nasdaq to recover from its biggest two-day decline since December.
Financials moved north after the U.S. Treasury Department revealed a plan to amend the financial regulatory framework.Meanwhile, investors remained focused on the outcome of the Fed’s two day policy meeting and the testimony of Attorney General Jeff Sessions before the Senate Intelligence Committee.
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.
The Dow Jones Industrial Average (DJI) advanced 0.4% to a record close at 21,328.47, retreating from an intraday high of 21,332.77. The S&P 500 rose 0.5% to a record close at 2,440.35. The tech-laden Nasdaq Composite Index gained 0.7% to finish at 6,220.37. The fear-gauge CBOE Volatility Index (VIX) traded near 10.6. Advancers outnumbered declining stocks on the NYSE by a 2.11 to 1 ratio.
Technology Shares Recover
Shares of technology stalwarts such as Apple (AAPL – Free Report) , Alphabet (GOOGL – Free Report) and Microsoft (MSFT – Free Report) recovered on Tuesday pushing the benchmarks higher. Investors appeared to have recovered their faith in tech shares following a sharp two-day decline in Apple, Facebook (FB – Free Report) and other major technology shares. Amazon (AMZN – Free Report) , Facebook and Microsoft all recorded a gain of more than one percent. Apple’s shares finished 0.8% higher, while Alphabet gained 0.9%.
Technology shares slumped following the release of a report from Goldman Sachs which issued warnings on valuations of tech giants such as Facebook, Amazon, Apple, Microsoft and Alphabet. The downgrade of tech giant Apple by Mizuho Securities on Sunday extended the tech selloff into Monday.
A recovery of technology shares had a positive impact on the broader markets. The broader Technology Select Sector SPDR (XLK) advanced 0.7%, recovering from its biggest two-day decline in almost a year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
All Eyes on Fed’s Policy Meeting
Investors remained focused on the Federal Open Market Committee’s (FOMC) upcoming decision on interest rates at the end of two day policy meeting on Wednesday. Expectations for a June rate hike following the Fed meeting heightened. According to the CME FedWatch tool, the probability of a rate hike at the Fed’s June 13-14 meeting held steady at 99.6%.
Additionally, financials were boosted after the U.S. Treasury Department revealed a plan on Monday to change financial regulatory framework. The proposed plan includes easing of restrictions that banks face in their trading operations and curbing powers of the Consumer Financial Protection Bureau.
Meanwhile, investors also kept a close watch on Attorney General Jeff Sessions’ testimony before the Senate Intelligence Committee on Tuesday. Jeff skipped many questions, saying that it would be inappropriate to reveal “confidential communications” between him and President Trump.
As per the U.S. Bureau of Labor Statistics, the seasonally adjusted Producer Price Index for final demand remained flat in May. The PPI recorded an increase of 2.4% in twelve months through May, retreating from April’s 2.5% increase, which was the biggest yearly gain since February 2012. Moreover, the core PPI gained 2.1% in the twelve months through May after a similar increase in April.
Stocks that made Headlines
Oklahoma based upstream player WPX Energy, Inc. (WPX – Free Report) recently inked a deal with a privately held midstream company, Howard Energy Partners, to form a 50-50 joint venture (JV). (Read More)
In a move to enhance the presence of its 3D Printing technologies globally, HP Inc. (HPQ – Free Report) recently made a series of announcements that will help in strengthening its foothold in the Asia-Pacific region. (Read More)
Zacks’ 2017 IPO Watch List
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