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Yesterday’s upbeat vaccine news sent the Dow Jones and S&P 500 higher on Monday, while the Nasdaq fell, weighed down by home office stocks. The decline in technology continues Tuesday.
Here’s what the key indices look like at the closing times at 10pm Norwegian time on Tuesday night:
- The industrial-heavy Dow Jones was up 0.9 percent.
- The broad S&P 500 Index is down 0.14 percent.
- The Nasdaq Composite Technology Index was down 1.37 percent.
Therefore, the Dow Jones continues to rise since Monday, when the index finished as high as 2.95 percent.
Rotation in the market
So far, Nasdaq has benefited from people having to stay home during the corona pandemic. Now, however, a change is seen in the market, where companies associated with the improvement of the economy and the reopening of society are doing better.
According to CNBC, chief strategist Terry Sandven says that technology and communications services will remain the favorite sectors in the long term, but that in the short term, now that an economic improvement is in sight, these will be surpassed by companies and manufacturers of cars and airlines. Sandven calls it a rotation in the market, which he believes will continue through the end of the year.
Both Chevron and Boeing shares are up four and five percent, respectively.
Shares of the head office, Zoom and Amazon, continue to fall in the US stock market, nine and 3.5 percent, respectively.
Markets reacted immediately to news Monday that the US pharmaceutical company Pfizer, in collaboration with Germany’s Biontech, has developed a coronary vaccine that may be 90 percent effective.
– There may still be setbacks, related to difficulties with distribution and the like, but the news is positive nonetheless and gives hope that you can get back to normal faster than you had dared to hope before. In any case, it seemed to be the verdict of investors so far, writes interest rate and currency analyst Ingvild Borgen Gjerde in her morning report Tuesday.
Market reaction is strongest in Europe
European stock markets rose sharply after Monday’s news. Wall Street opened to an all-time high, but spirits soured towards the end of the trading day and the Nasdaq fell 1.5 percent.
That market reactions were higher in Europe is natural, for several reasons, Gjerde writes.
– First of all, yesterday’s news was something that really gives optimism about the prospects for weight to come. Thus, it was cyclical optimism that propelled equity markets higher, in contrast to what largely propelled equity markets higher earlier this year, namely the extremely favorable policy of the central bank.
The latter has mainly benefited large technology companies, both because low interest rates make the present value of their earnings very high in the future and because many have increased their profits, despite the sharp decline in activity. generally economical, according to Gjerde.
He also notes that Europe has been more economically affected by the crown crisis, as the shutdown has been more extensive.
The main index of the Oslo Stock Exchange closed 0.48 percent lower at 878.93 points on Tuesday and thus fell slightly after Monday’s sharp rise.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content can only be done with written permission or as permitted by law. For more terms, see here.
