Nasdaq continues to fall as Dow sets new high
- 6th May 2021
- Posted by: Hakeem
- Category: Stock
The Dow Jones Industrial Average rose 97.31 points or 0.3% to close at 34,230.34, a new high.
The S&P 500 index increased by 0.1% to 4,167.59 points. However, the Nasdaq Composite dropped 0.4% to 13,582.42, as Amazon, Netflix, and Facebook both fell more than 1%.
The sharp drop in growth stocks the day before came after Treasury Secretary Janet Yellen indicated on Tuesday that interest rates would need to rise to prevent the economy from overheating, with economic activity rebounding much faster than anticipated as vaccines are administered and social distancing requirements are relaxed. Later in her remarks, she clarified that she was not “predicting or suggesting” a near-term interest rate hike because the Federal Reserve makes that decision.
Nonetheless, some companies have stated that rising demand and supply chain shortages have driven prices higher, raising concerns among market participants about signs of overheating. According to an ADP study released on Wednesday, private payrolls increased by 742,000 jobs in April. This result fell short of economists surveyed by Dow Jones’ estimates of 800,000 jobs. The March report from ADP was revised upward by 48,000 workers.
According to economists polled by Dow Jones, the IHS Markit U.S. services purchasing managers index came in at 64.7 in April, beating expectations of 63.3. However, the ISM non-manufacturing index came in at 62.7, which was slightly below estimates. PMIs are measured so that readings above 50 indicate that an economic field is expanding.
After data from the American Petroleum Institute showed a sharp drawdown in U.S. oil inventory, oil prices initially soared, with futures for the U.S. benchmark West Texas Intermediate topping $66 per barrel. The United States of America West Texas Intermediate (WTI) crude settled at $65.63 per barrel, down 6 cents, or 0.09%.
As countries struggle to produce life-saving doses, the Biden administration declared on Wednesday that it supports waiving intellectual patent rights for Covid-19 vaccines. Following the story, large pharmaceutical firms that manufacture vaccines saw their stock prices plummet. Moderna’s stock has fallen by more than 6%.