Wall Street rises as investors chase bargains outside tech

Wall Street rises as investors chase bargains outside tech

Wall Street’s main indexes experienced gains on Monday as investors shifted their focus to sectors beyond technology. This comes as a week filled with earnings reports and a Federal Reserve meeting unfolds. Microsoft, Google-owner Alphabet, and Meta Platforms will be closely watched this week to determine if their earnings justify their high valuations.

The Nasdaq Composite Index, which is heavily weighted towards technology stocks, has outperformed its peers this year with a 34% rally. This is due to the rise of rate-sensitive megacap growth companies and optimism about the end of the Fed’s tightening cycle and the potential of artificial intelligence.

However, the Nasdaq lagged behind other major indexes as investors sought bargains in non-tech stocks. Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research, noted that investors are broadening their market investments and looking for better bargains outside of the tech sector.

Chevron’s upbeat preliminary quarterly earnings over the weekend helped the Dow achieve its longest winning streak in over six years. Chevron gained 2.73% as the oil giant posted positive results.

According to Refinitiv data, second-quarter earnings are expected to decline by 7.9%. Additionally, the Federal Reserve is expected to raise interest rates by 25 basis points at its policy-making meeting on Wednesday. Economists polled by RushHourDaily anticipate that this will be the last hike of the current tightening cycle.

The Dow Jones Industrial Average rose 0.58%, the S&P 500 gained 0.46%, and the Nasdaq Composite added 0.17%. Energy stocks led the gains, with a 2.28% increase in the energy sector.

Toymaker Mattel saw a 1.99% rise in its stock price as the “Barbie” movie set a record as the biggest domestic debut of 2023. Meanwhile, AMC Entertainment experienced a 36.05% jump after a judge blocked the theater chain’s stock conversion plan. However, AMC’s preferred shares fell 2.72%.

Nasdaq, the exchange operator, made adjustments to the weight of certain companies in the Nasdaq 100 to address concerns of over-concentration in the benchmark.

A survey showed that business activity slowed to a five-month low in July, primarily due to decelerating service-sector growth.

Advancing issues outnumbered decliners on the NYSE, while decliners slightly outnumbered advancers on Nasdaq.

Overall, the S&P 500 posted 19 new 52-week highs and one new low, while the Nasdaq Composite recorded 47 new highs and 76 new lows.

Please note that this story has been refiled to add a dropped word in the headline.

Reporting by Carolina Mandl, Bansari Mayur Kamdar, and Johann M Cherian; Editing by Shounak Dasgupta, Anil D’Silva, and Richard Chang.

About News Team

Hi, I'm Alex Perez, an experienced writer with a focus on lifestyle and culture news. From food and fashion to travel and entertainment, I love exploring the latest trends and sharing my insights with readers. I also have a strong interest in world news and business, and enjoy covering breaking stories and events.

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