Tech rally loses steam, McDonald's pushes Dow higher

Tech rally loses steam, McDonald's pushes Dow higher

By Sruthi Shankar

(Reuters) - A rally in technology stocks came to a halt on Thursday, setting up the Nasdaq for its first loss in five days, while a jump in McDonald's shares boosted the Dow.

Shares of the world's biggest fast-food chain rose 3.7 percent after media reports that the company was planning a new round of layoffs.

The S&P technology index fell 1 percent, led by heavyweights Facebook, Microsoft and Alphabet, after rising for six previous sessions.

"It's probably a slight give back considering a pretty robust return month-to-date already," said Michael Dowdall, investment strategist at BMO Global Asset Management in Chicago.

However, there were a few bright spots in the sector, with some chipmakers and optical stocks gaining after U.S. Commerce Secretary Wilbur Ross said Washington had reached a deal with China's No. 2 telecommunications equipment maker ZTE that would allow it to do business again with U.S. suppliers.

Qualcomm and NXP Semiconductors also rose 1.9 percent and 6.5 percent respectively. A $44 billion acquisition of NXP by Qualcomm is still under review by China's market regulator, although there have been some signs of progress as China and Washington negotiated on trade in the past month.

"It's a relatively quiet week. Everyone is getting geared up for the next when we have the Fed, ECB, BoJ making decisions, along with the Trump-Kim meeting," said Dowdall.

"That's what people are really looking forward to, at this point, it's a quiet melt-up."

At 11:35 a.m. ET, the Dow Jones Industrial Average was up 122.15 points, or 0.49 percent, at 25,268.54, the S&P 500 was down 0.43 points, or 0.02 percent, at 2,771.92 and the Nasdaq Composite was down 49.09 points, or 0.64 percent, at 7,640.16.

Brent crude gained nearly 2 percent on concerns of a plunge in exports from Venezuela, helping the S&P energy index rise more than 1.7 percent.

J.M. Smucker's shares fell 5 percent after the Folgers coffee maker reported quarterly results and full-year forecast that missed Wall Street estimates.

Investors will look to a G7 summit starting in Canada on Friday for more signs on the trade tensions and tit-for-tat tariffs which weakened the stock market through February and March.

The two-day meeting will be the first chance for world leaders to confront Trump in person, since U.S. tariffs on steel and aluminum imports from Canada, Mexico and the European Union were imposed last week.

Canada and Mexico have retaliated against a range of U.S. exports and the EU has promised to do so as well.

Advancing issues outnumbered decliners for a 1.23-to-1 ratio on the NYSE for a 1.19-to-1 ratio on the Nasdaq.

The S&P recorded 51 new 52-week highs and seven new lows, while the Nasdaq recorded 204 new highs and 19 new lows.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Patrick Graham and Shounak Dasgupta)

This story has not been edited by Firstpost staff and is generated by auto-feed.


Updated Date: Jun 08, 2018 00:05 AM

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