Business News: Equity futures open higher as Nasdaq slips in correction.
Stock futures opened higher on Monday evening, with tech stocks stabilizing after another session of deep losses. The Dow added to previous earnings.
Contracts on the Nasdaq rallied after the index sank in a correction by the end of the regular session, plunging more than 10% from a recent closing record. Tesla shares stabilized in overtime trading after falling another 6% on Monday, bringing the March loss to nearly 17%. Apple shares fell to their lowest level since November.
The Dow, meanwhile, hit an intraday high on Monday before cutting some gains. Disney led the progress in the 30-stock index ahead of the company’s annual meeting of shareholders on Tuesday, while Cisco, Walgreens Boots Alliance and Visa also outperformed. The utilities, financials and materials sectors gained in the S&P 500 index, bucking the downward trend in the broader blue chip index.
Stock futures open higher after Nasdaq sinks into correction The stark contrast between the performance of the Dow and the Nasdaq underlines that investors are drifting further and further from technology stocks in favor of value and cyclical stocks whose gains are closely linked to a strong economic recovery. The U.S. House of Representatives is poised to accept the Senate-approved $ 1.9 trillion stimulus package over the weekend, potentially passing legislation this week and preparing the economy for another massive stimulus injection. This outlook also pushed bond yields higher, with the 10-year Treasury yield rising to 1.61%, a jump of around 50 basis points. from his level just a month ago.
All of these factors have contributed to making growth and tech stocks less attractive to investors, especially after many of their soaring increases over the past year. Actions of Zoom Video Communications – an example of the “work from home ”trade in 2020 – have fallen 8% so far, after rising nearly 400% last year. Shares of other tech companies and companies that promote social distance have experienced a similar slump.
“This is a trend that generally occurs when you come out of a recession: you see stocks moving towards cyclical companies. Things like value companies or small caps, things like energy, tend to do very well when you come out of a recession. And what happened last year was that those tech companies did so well that their prices went extremely high, “Courtney Dominguez, Payne Capital Management’s senior equity advisor, told Yahoo Finance on Monday. these companies will leave.
I think a lot of these companies will be things that we will have in our workplaces in the future as well. But the question is: these companies are so expensive, is all the optimism already taken for granted? And this is a different thing from these activities continue to play a major role in how we work in the future. “