(Reuters) – The S&P 500 fell on Tuesday while the Nasdaq hit a record high, as investors balanced worries about the slowing pace of economic recovery with expectations that the Federal Reserve will maintain its accommodative monetary policy. Amgen Inc dropped 2.3% and Merck & Co fell 1.6% after Morgan Stanley cut its rating on […]
Big Tech fuels Nasdaq record, S&P 500 dips
(Reuters) – The S&P 500 fell on Tuesday while the Nasdaq hit a record high, as investors balanced worries about the slowing pace of economic recovery with expectations that the Federal Reserve will maintain its accommodative monetary policy.
Amgen Inc dropped 2.3% and Merck & Co fell 1.6% after Morgan Stanley cut its rating on the stocks to “equal-weight” from “overweight”.
The Nasdaq rose to its highest level ever, lifted by Big Tech stocks that have fueled Wall Street’s gains in recent years. Apple climbed 1.5% and Netflix added 3%, both also hitting record highs. Amazon gained 1.3%.
“You could call it a gravitation toward Big Tech. As people feel a bit uncertain about how COVID will play out, you don’t have your reopening worries with those companies,” said Tom Martin, senior portfolio manager at Globalt Investments in Atlanta.
Much of the rest of Wall Street fell. Eight out of eleven sub-indexes traded lower, with economy-sensitive sectors like industrials, real estate and materials leading declines.
Tepid August payrolls data on Friday last week raised concerns that the economic recovery was slowing down.
Easy central bank policies and reopening optimism have pushed the benchmark indexes to record highs over the past few weeks, but concerns over rising coronavirus infections due to the Delta variant and its impact on the economic recovery could impede the rally.
In afternoon trading, the Dow Jones Industrial Average was down 0.58% at 35,164 points, while the S&P 500 lost 0.20% to 4,526.57.
The Nasdaq Composite added 0.2% to 15,394.91.
The S&P 500 hit a record high on Thursday and it is up about 20% year to date.
Boeing Co dropped 1.8% after Ireland’s Ryanair said it had ended talks with the planemaker over a purchase of 737 MAX 10 jets worth tens of billions of dollars due to differences over price.
Match Group Inc shares jumped 6.4% after the S&P Dow Jones Indices said on Friday the Tinder parent will join the benchmark index.
Columbia Property Trust Inc surged 15% after Pacific Investment Management Company said it would buy the company for $2.2 billion. [L4N2Q92J1]
Declining issues outnumbered advancing ones on the NYSE by a 2.01-to-1 ratio; on Nasdaq, a 1.50-to-1 ratio favored decliners.
The S&P 500 posted 16 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 107 new highs and 18 new lows.
(Reporting by Noel Randewich; Additional reporting by Shashank Nayar in Bengaluru; Editing by Anil D’Silva and Arun Koyyur; Editing by Aurora Ellis)