By Chuck Mikolajczak
| NEW YORK
NEW YORK A sharp decline in technology stocks weighed on both the Nasdaq and the S&P 500 indexes on Thursday, while the Dow managed to stay afloat thanks to advances in bank and energy shares. Declines in Facebook (FB.O), off 2.8 percent at $115.14, and Microsoft (MSFT.O), down 1.8 percent to $59.18, sent the Nasdaq to its lowest intraday level in two weeks, while the S&P 500 technology index .SPLRCT was down 2.3 percent, on pace for its worst daily performance in nearly three months.While Wall Street has rallied since the November election on hopes that President-elect Donald Trump's policies will trigger inflation and hasten a rise in interest rates, technology stocks have failed to participate, dropping more than 2 percent."In a higher rate environment you are going to want to pay less for growth further out. To a large extent that is probably what is happening in the higher (price-to-earnings) stocks," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh. "Everybody is getting tarred and feathered."The Dow managed to move higher, as gains in high-priced names in the financial and energy sectors advanced. Goldman Sachs (GS.N), up nearly 3 percent, accounted for nearly 40 points to the plus side for the price-weighted index. The stock is up nearly 24 percent since the election.
The Dow Jones industrial average .DJI rose 62.35 points, or 0.33 percent, to 19,185.93, the S&P 500 .SPX lost 8.34 points, or 0.38 percent, to 2,190.47 and the Nasdaq Composite .IXIC dropped 72.19 points, or 1.36 percent, to 5,251.49.A continued rally in oil helped Chevron (CVX.N) and ExxonMobil (XOM.N) advance. Brent futures LCOc1 settled up more than 4 percent after a nearly 9 percent jump on Wednesday after major oil producers agreed to cut output and support prices, the first such move since 2008.The S&P 500 energy index .SPNY rose 0.4 percent, while the S&P financial index .SPSY climbed 1.6 percent.
Investors are now turning their attention to Friday's U.S. payrolls report for confirmation the economy continues to strengthen, with an eye on an expected hike in benchmark U.S. interest rates by the Federal Reserve at its meeting on Dec. 13-14.Traders have priced in a 91 percent chance of a rate increase in December, according to Thomson Reuters data.Dollar General (DG.N) shares were among the worst performers on the S&P, falling 5.4 percent after the discount retailer reported a surprise drop in quarterly comparable sales and tempered its full-year profit forecast.
Bluebird Bio (BLUE.O) soared 14.1 percent to $69.85 after the gene-therapy developer said patients undergoing its multiple myeloma treatment showed strong benefits. Shares of Celgene (CELG.O), which is developing the therapy with Bluebird, edged up 0.5 percent to $119.05.Skechers (SKX.N) surged 15.8 percent after the shoe seller's chief executive bought $11 million worth of stock.Declining issues outnumbered advancing ones on the NYSE by a 1.71-to-1 ratio; on Nasdaq, a 1.63-to-1 ratio favored decliners.The S&P 500 posted 79 new 52-week highs and seven new lows; the Nasdaq Composite recorded 164 new highs and 51 new lows. (Reporting by Chuck Mikolajczak; Editing by James Dalgleish)
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First Published On : Dec 2, 2016 02:15 IST