Traders work on the floor of the New York Stock Exchange during morning trading on December 13, 2023 in New York City.
Michael M. Santiago | Getty Images
Good news for Wall Street today! The S&P 500 and Nasdaq Composite rose Monday, boosted by tech shares, as the market tries to recover from a tough week. The Dow Jones Industrial Average, however, was under pressure as Boeing declined.
The broad market index gained 0.7%, while the Dow lost 51 points, or 0.1%. The Nasdaq outperformed, rising 1.5%.
Investors are eagerly buying the dip in the technology sector, which lost 4% last week, as yields fell on Monday. Big names like Nvidia and Amazon are leading the charge, with Nvidia rising more than 4%, reaching an all-time high, and Amazon rising more than 1% to also boost the Nasdaq. Even Apple is up, ticking more than 1% higher after Evercore ISI advised clients to buy last week’s dip.
The yield on the 10-year Treasury yield lost nearly 4 basis points, adding to investor confidence in the tech sector.
However, Boeing has been weighing on the Dow, falling more than 6.5% following the temporary grounding of dozens of Boeing 737 Max 9 aircrafts for inspections after a section of an Alaska Airlines flight blew out.
Despite the recent market turbulence, Adam Turnquist, chief technical strategist at LPL Financial, said “I think it’s still a new year, the same bull market with the same risk.” He mentioned last week’s losses coupled with Monday’s moves on the 10-year yield have given investors “enough confidence to step back into tech.”
“The simple story is stocks were overbought and yields were oversold, and now we had an excuse for a little bit of a bounce in both directions…it’s nothing really too concerning at this point,” Turnquist added.
Last week was Wall Street’s first losing week in 10 as mega-cap tech stocks such as Apple underperformed, and Treasury yields rose. The Dow Jones Industrial Average dropped 1.5% for the week, and the S&P 500 slid 0.6%. The tech-heavy Nasdaq Composite posted its worst weekly performance since September, falling 3.25%.
Investors will be paying close attention to the December consumer price index and the producer price index to see where the central bank’s rate cuts will be heading.
But that’s not all – traders will also be looking at the performance of the S&P 500 for the first five trading days of January, which may give some insights into the market’s future direction.
On Monday, the S&P 500 looked set to post a loss for the first five trading days of January, potentially signaling near-term weakness could continue for the broader index, according to Chris Larkin, managing director at E-Trade from Morgan Stanley.