Technology stocks again rode to Wall Street’s rescue on Friday, lifting the main indexes more than 1 percent, but the Dow Jones and the S&P 500 still posted their longest weekly losing streaks in a year as fears of a slowing economy sparked an almost month-long rout.
Investors started buying beaten-down shares after the NASDAQ confirmed a corrective phase earlier this month and the S&P 500 on an intra-day basis briefly broke that barrier this week.
The Dow and S&P 500 notched their fourth straight weekly declines, the longest weekly losing streak since August last year. The NASDAQ closed higher for the week after falling the previous three, and is now up 22 percent for the year. The S&P 500 is up a bit more than 2 percent for the year.
Investors are looking at the long term and believe technology remains the investment of choice, said Edward Moya, senior market analyst at Oanda Corp in New York.
“It’s dip buying,” Moya said. “When you look at the correction that we’ve seen in these tech giants, people are still going to want to hold US equities. The reality is that 2021 is going to be a much higher stock market and you’re probably going to see tech still lead the way.”
Shares of tech mega-caps Apple Inc, Microsoft Corp and Amazon.com Inc led the way, followed by Nvidia Corp and Facebook Inc, rising at least 2.1 percent.
The information technology index jumped 2.4 percent as investors ditched value-linked stocks on signs of a slowdown in the broader economic recovery.
Growth-oriented shares gained at a rate almost twice that of value stocks.
Volatility has also shot up as investors look for clarity on whether the US Congress plans to approve more stimulus ahead of the Nov. 3 presidential election, which now appears unlikely.
The CBOE Market Volatility Index, known as Wall’s fear gauge, fell 7.68 percent.
“You’ve had this nice recovery through the summer, and coming into the fall the economy is just a little bit more vulnerable, particularly with a lot of the stimulus that we had starting to taper off now,” said Mike Dowdall, portfolio manager at BMO Global Asset Management in Chicago.
The Dow Jones Industrial Average rose 358.52 points, or 1.34 percent, to 27,173.96. The S&P 500 gained 51.87 points, or 1.6 percent, to 3,298.46 and the NASDAQ Composite added 241.3 points, or 2.26 percent, to 10,913.56.
For the week, the Dow unofficially fell 1.75 percent, the S&P 500 slid 0.63 percent, and the NASDAQ gained 1.11 percent.
The volume on US exchanges was 8.89 billion shares.
The S&P industrials sector rose 1.49 percent as data showed new orders for key US-made capital goods jumped last month, while a 0.06 percent slide in energy stocks gave them their worst week since mid-June.
Shares of Boeing Co rose 6.8 percent and led the Dow higher after the US Federal Aviation Administration said that its chief would conduct an evaluation flight of the grounded 737 MAX and European safety regulators indicated a potential resumption of flights by year-end.
Advancing issues outnumbered declining ones on the NYSE by a 2.30-to-1 ratio, while on the NASDAQ, a 2.94-to-1 ratio favored advancers.
The S&P 500 posted one new 52-week high and no new lows; the NASDAQ Composite recorded 26 new highs and 49 new lows.
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