NEW YORK, RAW – The S&P 500 and Dow have rose in a broad-based rally, with technology, healthcare and financial stocks providing the biggest lift as investors bet on a recovery that is expected to deliver the fastest economic growth since 1984.
The S&P 500 and the Dow ended a seesaw week higher as investors rebalancing their portfolios at the quarter’s end continued to buy stocks that stand to benefit from a growing economy while they added some beaten-down technology shares.
The Nasdaq also ended higher as less popular tech shares advanced, but the composite index posted its second weekly decline in a row.
Wall Street surged in the last half-hour of trading on Friday, lifting all three indices more than one per cent.
Some of the tech heavyweights slid, such as Tesla Inc and Google parent Alphabet Inc, but Microsoft Corp and Facebook Inc bucked the trend, helping lift the S&P 500 and Nasdaq higher.
“It is less a move out of technology than a move that evidences a broader appetite for equities to include both growth and value,” said John Stoltzfus, chief investment strategist at Oppenheimer Asset Management in New York.
The Dow Jones Industrial Average rose 453.4 points, or 1.39 per cent, to 33,072.88. The S&P 500 gained 65.02 points, or 1.66 per cent, to 3,974.54 and the Nasdaq Composite added 161.05 points, or 1.24 per cent, to 13,138.73.
For the week, the S&P rose about 1.6 per cent and the Dow 1.4 per cent, while the Nasdaq slipped 0.6 per cent.
Volume on US exchanges was 12.23 billion shares, compared with the 13.67 billion average for the full session during the past 20 trading days.
L Brands jumped 3.7 per cent after the Victoria’s Secret owner raised its current-quarter profit forecast for the second time this month as it benefits from consumers spending their stimulus cheques and relaxation of COVID-19 restrictions.
The Federal Reserve last week raised its GDP estimate for 2021 to 6.5 per cent from 4.2 per cent and many economists expect still faster growth, which has spurred fears the economy could run too hot and force the Fed to raise interest rates.
The dollar eased but remained near four-month peaks on continued optimism about the US economy.
Bank stocks gained 1.9 per cent as the Fed said it would lift income-based restrictions on bank dividends and share buybacks for “most firms” in June after its next round of stress tests.
The yield on benchmark 10-year US Treasury notes rose to 1.66 per cent, lower than a spike last week to 1.75 per cent that sparked a sell-off on inflation fears and a potential Fed rate hike – something the Fed has pledged not to do.
Energy stocks jumped 2.6 per cent, tracking a boost in crude prices after a giant container ship blocking the Suez Canal spurred fears of a supply squeeze.
Ten of the 11 major S&P sectors rose, with only the communication services index in the red.
Advancing issues outnumbered declining ones on the NYSE by a 3.30-to-1 ratio; on Nasdaq, a 1.81-to-1 ratio favoured advancers.
The S&P 500 posted 65 new 52-week highs and no new lows; the Nasdaq Composite recorded 82 new highs and 51 new lows.