Following recent strong gains, the S&P 500 and Dow dropped on Tuesday (US time) while the Nasdaq prolonged its record run and for the first time rose briefly above the 10,000 mark.
Investors have anticipated the Federal Reserve conference this week. Although no big policy changes are anticipated when the U.S. central bank wraps up its two-day meeting on Wednesday, investors will scrutinize its remarks on the economy’s safety, which was reopening after closures associated with coronavirus.
The S&P 500 benchmark, which on Monday erased its losses for the year, is roughly 5 percent below its own all-time high.
The Nasdaq entered the third straight session with a new intraday high. It set a closing high on Monday and became the first of the main indexes on Wall Street to confirm a new bull market after hitting a low on March 23. Apple was the star performer, adding more than 3 per cent to a report it is preparing to announce a shift in Mac computers to its own main processors.
The Dow Jones Industrial Average in late trade is 241.63 points, or 0.88%, lower, the S&P 500 has lost 20.34 points, or 0.6%, to 3.212.05 and the Nasdaq has added 46.28 points, or 0.5%, to 9.971.02.
The ASX is poised for sharp losses this morning, with futures pointing to a 90-point drop at 5 am AEST, or 1.5 per cent at the open. The ASX added 2.4 percent Tuesday.
“It strikes me as maybe a reflexive selloff as a result of a tremendous rally over the past week. There’s no news headline that screams bearish catalyst to me. But conversely, other than the nonfarm payrolls data, the past two weeks haven’t had super bullish catalysts either,” said Mike Zigmont, head of trading at Harvest Volatility Management in New York.
“In the grand scheme of things, it seems like the market has caught a bullish fever, and it’s feeding on itself.”
After strikingly upbeat May job data, the rally in US stocks accelerated last week, reinforcing views that the worst of the pandemic’s economic impact was over.
The biggest drag on the S&P 500 benchmark were financial, industrial and energy stocks, which have surged in recent weeks on hopes for an improved economic outlook.
US financial market operators, including the New York Stock Exchange, observed a moment of silence in memory of George Floyd, an African American 46-year-old who died on May 25 after a white cop knelt nearly nine minutes on his neck.
The S&P 1500 airlines index fell as cruise operators Carnival Corp and Norwegian Cruise Line Holdings fell as a result of their recent sharp recovery in the face of recent signs of a global travel pickup.
The closely watched US yield curve steepened the most since March as US data improved.
Declining issues outnumbered NYSE advancing ones by a 3.15-to-1 ratio; Nasdaq favored decliners by a 1.76-to-1 ratio.
The S&P 500 posted 9 new 52-week highs and no new lows; 45 new highs and one new lows were recorded in the Nasdaq Composite.
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