Nasdaq posts record close as tech stocks shine

Nasdaq posts record close as tech stocks shine

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In June, the Nasdaq became the first of the major Wall Street indexes to recoup its coronavirus-induced losses as several of its largest constituents, including Amazon.com and Netflix, benefited from curbs on social activity.

“Tech is the only trade,” said Jake Dollarhide, chief executive officer of Longbow Asset Management. “Things that were 10 years away on February 18 are here now: Distance learning, seeing your doctor via Zoom, ordering pharmaceuticals via the mail.”

Lowe’s and Home Depot each rose more than 2 per cent rose ahead of their earnings later in the week. The two home improvement chains are expected to have received a bump to their quarterly sales from consumers looking to do minor repair work while spending more time at home.

The S&P 500 retailing index climbed 1.4 per cent, with heavyweights Walmart and Target also set to report results this week.

“Earnings season in general has been much better than expected, but a big part of that is because the expectation has been so low,” said Willie Delwiche, investment strategist at Baird in Milwaukee.

Rackspace Technology jumped over 10 per cent after Reuters reported Amazon is in early talks to invest in the cloud services provider.

As of Friday, 457 companies in the S&P 500 had posted results, of which 81.4 per cent came in above dramatically lowered expectations, according to Refinitiv data.

Minutes of the Federal Reserve’s latest meeting, due on Wednesday, are expected to provide more insight into the central bank’s view of an economic recovery, while housing starts data is also on tap.

Caution is expected to seep into markets ahead of the November US presidential vote, as the election season kicks into higher gear with the Democratic National Convention, which runs Monday through Thursday.

The Dow Jones Industrial Average fell 0.31 per cent to end at 27,844.91 points, while the S&P 500 gained 0.27 per cent to 3,381.99.

The Nasdaq Composite climbed 1 per cent to 11,129.73, its fifth closing high this month.

Seven of the 11 major S&P sectors rose, with technology providing the biggest support to the S&P 500 index.

Principia Biopharma surged 9.3 per cent to a record high after French healthcare firm Sanofi SA said it would buy the company for about $US3.7 billion ($5.1 billion).

Advancing issues outnumbered declining ones on the NYSE by a 1.22-to-1 ratio; on Nasdaq, a 1.20-to-1 ratio favoured advancers.

The S&P 500 posted 29 new 52-week highs and no new lows; the Nasdaq Composite recorded 85 new highs and 12 new lows.

Volume on US exchanges was 7.9 billion shares, compared with the 10 billion average for the full session over the last 20 trading days.

Reuters

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