NEW YORK, June 23 ― The Nasdaq ended at a record high yesterday, lifted by Amazon, Microsoft and other top-shelf tech companies as investors shifted their focus to growth stocks.
Microsoft rose 1.1 per cent and its stock market value briefly breached US$2 trillion (RM8.32 trillion) for the first time, while Apple, Facebook and Amazon also rallied more than 1 per cent each.
Amazon had over US$5.6 billion in total online sales in the United States on the first day of its Prime promotional event, according to Adobe Digital Economy Index.
In a congressional hearing, meanwhile, Federal Reserve Chair Jerome Powell reaffirmed the US central bank's intent to encourage a "broad and inclusive" recovery of the job market and not to raise interest rates too quickly based only on the fear of coming inflation.
So-called value stocks, expected to benefit from the economic recovery, have outperformed in 2021, while growth stocks, including major tech names like Apple and Nvidia, have rallied since the Fed last week took a stance on future rate hikes viewed by many as more aggressive than expected.
The S&P growth index has added almost 2 per cent since before the Fed last Wednesday projected an accelerated timetable for interest rate increases, compared with a drop of almost 2 per cent in the value index.
"The market was caught off guard regarding the Fed’s hawkish commentary, and that’s 100 per cent of what is happening," said Andrew Mies, chief investment officer of 6 Meridian. "All the smart people were surprised about how hawkish the Fed was, and now they are adjusting their portfolios."
Nine of the 11 major S&P sector indexes rose, with consumer discretionary and tech the biggest gainers, each up about 1 per cent.
The Dow Jones Industrial Average rose 0.2 per cent to end at 33,945.58, while the S&P 500 gained 0.51 per cent to 4,246.44.
The Nasdaq Composite climbed 0.79 per cent to 14,253.27.
GameStop jumped 10 per cent after the videogame retailer said it raised over US$1 billion in its latest share offering, cashing in further on this year's Reddit-driven surge in its stock price.
Sanderson Farms rallied about 10 per cent to a record high after JP Morgan raised its price target on the stock after a source told Reuters that the poultry producer was exploring a sale.
Twitter ended almost 3 per cent higher after it said it will seek applications from users to test new content subscription and ticketing features, as the social platform works to build more ways for users to earn money.
Moderna Inc rose 6.3 per cent after the European Union decided to take up an option under a supply contract with the drugmaker that allows the bloc to order 150 million additional Covid-19 vaccines.
Splunk Inc surged over 11 per cent after the data analytics software maker said private equity firm Silver Lake invested US$1 billion in the company's convertible senior notes.
Advancing issues outnumbered declining ones on the NYSE by a 1.26-to-1 ratio; on Nasdaq, a 1.08-to-1 ratio favoured advancers.
The S&P 500 posted 28 new 52-week highs and 1 new low; the Nasdaq Composite recorded 78 new highs and 56 new lows.
Volume on US exchanges was 9.5 billion shares, compared with the 11.1 billion average over the last 20 trading days. ― Reuters
