(Reuters) – The Dow and the S&P 500 were little changed on Tuesday after a six-day winning streak as investors rotated out of large-cap tech names into other sectors that likely will benefit from President Joe Biden’s proposed $1.9 trillion stimulus bill.
The tech-heavy Nasdaq hit an all-time high for the fifth consecutive session on early gains in Apple Inc, Amazon.com Inc and Google-parent Alphabet Inc, which later turned lower amid a shift in portfolio allocations.
The NYSE FANG+TM index, which includes Facebook, Netflix and Tesla, rose 1.4% to an all-time high.
With the number of COVID-19 cases declining and expectations the stimulus package with be approved in Congress, investors are hard-pressed to find significant negatives, said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.
“You’re not seeing money coming out of the market and going into cash,” James said. “You’re seeing money coming out of one sector and being rotated into another sector to maintain an overall long bias.”
At 2:46PM ET, the Dow Jones Industrial Average rose 38.07 points, or 0.12%, to 31,423.83, the S&P 500 gained 1.31 points, or 0.03%, to 3,916.9 and the Nasdaq Composite added 36.77 points, or 0.26%, to 14,024.41.
Largely upbeat corporate earnings, along with monetary and fiscal support, have powered the major U.S. stock indexes to record highs. But analysts caution against risks from new coronavirus variants and any glitches in vaccine rollouts.
“The backdrop is largely positive for stocks and I’m not sure there could be a better backdrop for risk assets in the near to intermediate term,” said William Herrmann, co-founder and managing partner at Wilshire Phoenix in New York City.
The energy sector, among those that led the recent rally, shed nearly 1.0%, while communication services added about 0.4%.
Data last week showing slower-than-expected jobs growth in the labor market underscored the need for more government aid to blunt the effect of the COVID-19 pandemic, Biden has said.
Democrats in the U.S. Senate continue to try to find a way to include a minimum wage increase in a comprehensive COVID-19 relief bill they aim to advance in the coming weeks, Senate Majority Leader Chuck Schumer said on Tuesday. [nW1N2K1005]
The banking index shed about 0.3%, tracking a fall in U.S. Treasury yields. [US/]
Toymaker Mattel Inc rose about 2.1%, while telephone equipment maker Cisco Systems Inc slipped 0.6% ahead of reporting earnings after market close.
Analysts forecast a fourth-quarter S&P earnings gain of about 2.5%, a stark reversal from the 10.3% annual decline seen at the beginning of the year, per Refinitiv.
Gucci lipstick maker Coty Inc tumbled 16% as weak demand for makeup products wiped millions off its quarterly revenue.
Take-Two Interactive Software Inc fell about 6% after the videogame publisher posted a drop in quarterly adjusted sales and shied away from announcing any new big releases.
Bitcoin fast approached the $50,000-mark as the afterglow of Elon Musk-led Tesla’s TSLA.O investment in the cryptocurrency had investors reckoning it may become a mainstream asset class for both corporations and money managers.
Cryptocurrency miner Riot Blockchain and Marathon Patent Group jumped 25% and 22%, extending their sharp gains for the second day. Tesla’s shares dropped about 2.2%.
Advancing issues outnumbered declining ones on the NYSE by a 1.55-to-1 ratio; on Nasdaq, a 1.50-to-1 ratio favored advancers.
The S&P 500 posted 39 new 52-week highs and no new lows; the Nasdaq Composite recorded 400 new highs and six new lows.
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