Tech Stocks Keep Wall Street Steady
At the start of the week, Wall Street experienced a split as losses were covered by gradual gains for healthcare and technology stocks. The Standard & Poor’s 500 Index rose by only 0.52 points, landing at 2,930.32 and bouncing back from the Monday morning’s losses of 0.9%. The Dow Jones industrial average dropped by 109.33 points, ending at 24,221.99 and the Nasdaq composite rose by 71.02, ending on 9,192.34.
It became clear that investors were drawn to technology stocks as they remain resilient despite the damage the COVID-19 pandemic has done to the global economy so far.
Investors continue to seek out businesses that will remain steady in both an ‘isolation’ economy and a normal economy.
Apple’s stocks increased by 1.6% while Nvidia rose by 3.2% and Advanced Micro Devices increased by 4.8% to become one of the largest increases in the S&P 500 on Monday.
Healthcare stocks are also doing consistently well and have reduced their losses for this year to 1%. Biotech stocks did particularly well on Monday and Cardinal Health had the largest rise in the S&P 500 by increasing by 6.7% due to the recent rise in pharmaceutical sales.
The gains in tech and healthcare stocks helped to balance out the fall of 69% experienced in the S&P 500.
Harvest Volatility Management’s head of research and trading, Mike Zigmont, said:
“People are looking ahead, and they’re saying, ‘OK, the pandemic has happened, and the damage has swept through our economy and our businesses, and now we’re planning on the growth after the carnage, so we’re valuing equities as if we’re going to go back to a decent growth environment‘.”
Despite the optimism that the economy could be improving, concerns still remain regarding the potential for new infection waves to hit countries that lifted their lockdown measures early on, such as China and South Korea.
Companies all over the world share uncertainties about the future and many have opted to neglect their financial forecasts in their quarterly earnings reports.
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