Wall Street rises as megacap stocks bounce; Dow hits record high

Source: Reuters

Wall Street’s main indexes and the Dow hit a record high on Wednesday, as growth stocks bounced from a steep selloff in the previous session and a survey showed private jobs rose in April.

Technology-related companies including Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc and Alphabet Inc rose between 0.1% and 1.7%.

The S&P 500 technology sector gained 0.9%, while the Philadelphia SE Semiconductor index added 1.8%.

“With stock indexes at or near record highs and coming off a massive rally in the past year, there’s a counterintuitive reaction function to the positive earnings reports to sell the news,” Art Hogan, chief market strategist at National Securities in New York, wrote in a client note.

“We would continue to recommend a diversified equity allocation with a barbell approach that has growth exposure on one end, and economically sensitive cyclical exposure on the other end.”

Six of the 11 major S&P 500 sectors rose in early afternoon trading, with commodity-sensitive sectors including energy and materials rising 3.5% and 1.3%, respectively.

Defensive utilities fell 2.2% and real estate dropped 1.3%, leading sectoral declines.

The ADP National Employment Report showed U.S. private payrolls increased in April as companies rushed to boost production amid a surge in demand, powered by massive government aid and rising vaccinations against COVID-19.

A more comprehensive reading in the form of the Labor Department’s non-farm payrolls data is due on Friday.

Strong economic data and earnings pushed the S&P 500 and Nasdaq indexes to record high last week, but markets have wobbled amid concerns about rising inflation and potentially higher U.S. interest rates.