Nasdaq Sets a New Record Close as Broader Market Struggles
The Nasdaq set a new record high on Tuesday with the help from the technology and consumer discretionary sectors. However, the broader market struggled amid US trade developments.
The tech-heavy Nasdaq finished higher by 31.40 points, or 0.41%, to 7,637.86. The gains for the Nasdaq came after the index hit a record close on Monday. On Tuesday, it reached a new intraday high, beating levels last seen in March.
“I think it makes sense that we’re seeing a rally in tech right now,” Sylvia Jablonski, managing director of capital markets at Direxion, told CNBC. “We’re seeing positive news around Apple announcing new software, new apps. Amazon’s sales are growing, [and] Microsoft has the GitHub takeover.”
“There could be a lot of momentum in that area,” Jablonski said.
The index’s biggest boost was from Amazon.com which gained 1.87% to 1,696.35. It also led gains in the S&P consumer discretionary index.
Further, Apple contributed the biggest gains to the technology index and the 2nd biggest for the Nasdaq. The tech-giant jumped 0.77% to 193.31 after announcing its latest mobile OS update, iOS 12, during Worldwide Developer Conference. It revealed upgrades to security, privacy, and digital health services to take on its competitors Facebook and Alphabet’s Google.
Meanwhile, Twitter rose 5.1% to close at 39.80 on news that the social media giant would join S&P 500 US index. Similarly, Netflix rallied 1.10% to end at 365.80 after news it would join the S&P 100 index.
While Nasdaq Enjoys, Other Markets Struggle
The Dow Jones industrial average dropped 13.71 points at 24,799.98, with Merck as the worst performer in the index. Similarly, the S&P 500 gained just 0.1% to 2,748.79.
Additionally, the 2 indexes struggled for gains as tensions between the United States and some of its key trading partners weighed Wall Street.
“This thing keeps dragging and dragging and dragging,” said Peter Boockvar, chief investment officer at Bleakley Financial Group. “No one wins tariffs like this. Steel prices have gone up a lot and there’s more users of steel than producers of steel.”
The Cboe Volatility Index is the most widely followed barometer of expected near-term volatility for the S&P 500. It closed down 0.34 point at 12.4, the lowest close since January 26.
Moreover, it was the financial sector that dragged down the S&P with a 0.4% drop. Bank of America and Citibank both dropped around 0.9%.
Shares of US food companies Kellog and General Mills declined around 2% as Mexico imposed wide-ranging tariffs on American products. These range from steel to pork and bourbon as a response to Trump’s tariffs on metal.
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