Wall Street closed mixed on Thursday growing concerns about the second wave of the coronavirus dented investors' confidence. However, the technology sector continued its rally. The Dow and the S&P 500 ended in red while the Nasdaq Composite finished in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) tumbled 1.4% or 361.19 points to close at 25,706.09. Notably, 26 components of the 30-stock blue-chip index ended in the red while 4 closed in green. The tech-heavy Nasdaq Composite ended at 10,547.75, gaining 0.5% due to strong performance by large-cap tech stocks. During intraday session the tech-laden index posted a new all-time high of 10,578.10.
Meanwhile, the S&P 500 lost 0.6% to end at 3,152.05. The Energy Select Sector SPDR (XLE) plunged 4.9%. Notably, nine out of eleven sectors of the benchmark index closed in negative territory while two in positive territory.
The fear-gauge CBOE Volatility Index (VIX) was up 4.2% to 29.26. A total of 10.73 billion shares were traded on Thursday, lower than the last 20-session average of 12.23 billion. Decliners outnumbered advancers on the NYSE by a 2.56-to-1 ratio. On Nasdaq, a 2.19-to-1 ratio favored declining issues.
Resurgence of Coronavirus Cases
On Jul 7, the United States reported a record high of more than 60,000 coronavirus cases in a single day. On Jul 8, this figure came in at more than 58,000. States like California, Texas and Florida witnessed the biggest spike in COVID-19 infections. According to Johns Hopkins University, the United States has more than 3 million confirmed coronavirus cases and more than 132,000 deaths.
Notably, the number of cases crossed 3 million from 2 million in less than a month time. Per a study by Wall Street Journal, the seven-day average for cases is higher than the 14-day average, reflecting the faster spread of COVID-19.
Technology Sector Holds Momentum
The Technology Select Sector SPDR (XLK), one of the 11 broad sectors of the S&P 500 index, recorded a fresh closing high at 108.11 on Jul 9, second in a row. Moreover, on Jul 9, the XLK recorded all-time intraday high at 108.62.
On Jul 8, the tech-heavy Nasdaq Composite recorded a fresh closing high of 10,547.75, it’s 26th of the year. Year to date, the tech-laden index have rallied 17.6%. However, the Dow and the S&P 500 indexes declined 9.9% and 2.4%, respectively, year to date.
Shares of technology behemoths like Advanced Micro Devices Inc. AMD, Microchip Technology Inc. MCHP and NVIDIA Corp. NVDA surged 7.2%, 3.4% and 2.9%, respectively. Microchip Technology carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Department of Labor reported that initial jobless claims for the week ended Jul 4 declined to 1.314 million from a downward revised estimate of 1.413 million in the previous week. The consensus estimate was 1.369 million. The four-week moving average of initial claims, which eliminates volatility in the weekly numbers, drop 14,000 to 1.43 million.
This is the 15th consecutive weeks in which initial claims remain above 1 million. However, the figure declined in last 14 successive weeks. Moreover, continuing claims (the number of people that have received unemployment benefit at least one time earlier) decreased 698,000 to 18.06 million for the week ended Jun 27.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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