Two indexes will tell you what you need to know about today’s stock market action.
The Dow Jones Industrial Average, driven by cyclicals, vaccine recovery stocks, and consumer stocks rose to an intraday record high. After a slight retreat at the end of the session, the Dow finished ahead 0.97% on the day.
The NASDAQ Composite, on the other hand, weighed down by technology and growth momentum stocks, dropped 2.41% on the day to fall into a full correction from the February 12 closing high.
Looking at individual gaining stocks, Disney (DIS) was one of the day’s big winners with the shares picking up 6.33% on the day on the general sentiment in favor of vaccine recovery stocks and on an announcement that the company’s California theme parks would reopen on April 1 at reduced capacity. On the same logic Six Flags (SIX) ended up 5.81% on the day. American Airlines (AAL) closed up 4.99%. Cyclicals such as Dow (DOW) and DuPont (DD) ended ahead 1.02% and 1.51%, respectvely. Ad agency Omnicom (OMC) gained 3.70%. CVS Health (CVS) was up 1.47%. MGM Resorts International moved higher by 1.86%. HanesBrands (HBI) picked up another 8.49%. Coca-Cola (KO) gained 1.73%. Banks were up across the board. The Invesco KBSB Bank ETF (KBWB) that I recently added to my Jubak Picks Portfolio closed higher by 1.98%.
On the other hand, almost everything tech was down and down big. NXP Semiconductors (NXPI) and Taiwan Semiconductor Manufacturing (TSM) dropped 5.47% and and 5.69%, respectively. You could, however, find worse performers pretty easily. Teladoc (TDOC) was down 6.92%. Skyworks Solutions (SWKS) lost 7.06%. Applied Materials (AMAT) retreated 6.50%. Tesla (TSLA) fell 5.84%.
What was different today–and I think this is important–is that the big tech stocks that had been holding strong last wee showed significant drops today. Apple (AAPL), for example, was down 4.17%. Nvidia (NVDA) lost 6.81%. Facebook (FB) dropped 3.39%. Netflix (NFLX) tumbled 4.47%. Qualcomm (QCOM) gave back 5.05%.
Solar and alternative energy stocks continued to shed their post-election gains. Enphase (ENPH) dropped 8.49%. SunRun (RUN) lost 9.38%.
The climb in Treasury yields, which has been so important in driving this correction in high valuation stocks, continued with the 10-year Treasury picking up 4 basis points to 1.60%. The yield on the 10-year Treasury is now up 43 basis points in one month and 84 basis points in one year. (It takes 100 basis points to make up one percentage point.)
