Stocks finished mixed Monday, with the Dow Jones Industrial Average setting an intraday record, but tech stocks declined as investors rotated out of the sector amid an increase in Treasury bond yields.
A report from CNBC that Appaloosa Management’s David Tepper said thathe was getting bullish on stocks and that a selloff in Treasuries likely was over also gave equities a boost.
The Dow Jones Industrial Average finished up 306 points, or 0.97%, to 31,802, the S&P 500 lost 0.54% and the tech-heavy Nasdaq fell 2.41%.
Analysts noted that investors were moving to value and cyclical stocks and away from expensive growth shares.
Rising bond yields, which have dominated market attention the past few weeks, have been hitting tech shares the hardest since the high-growth stocks can be more vulnerable to inflation pressures.
Treasury yields are on pace for their seventh weekly increase, the longest streak of gains in at least eight years.
The yield on the benchmark 10-year Treasury traded at 1.596% Monday, near one-year highs, after the Senate passed Biden's coronavirus relief package on Saturday.
The stimulus bill -- which includes $1,400 checks to American households and $300 in enhanced unemployment benefits -- likely will add to concern about near-term inflation and the upward march in bond yields.
Oil prices fell but not before Brent crude traded above $70 a barrel on Monday following an attack on a Saudi oil terminal over the weekend.
Brent crude, the global benchmark, fell to $67.96 a barrel after Saudi Arabia said its oil infrastructure came under missile and drone attack from Iran-backed Houthi rebels.
Saudi Arabia said the attacks were intercepted and oil output appeared to be unaffected, according to reports from Bloomberg and others.
U.S. crude on Monday touched its highest prices in more than two years. At last check, West Texas Intermediate crude oil was down 2.16% to $64.66 a barrel.
Stocks rose broadly on Friday, a rally that ended Wall Street's three-day losing streak as tech shares rebounded and Treasury yields stabilized. The S&P 500 rose 0.8% last week, its first weekly gain in three weeks, following a better-than-expected U.S. jobs report.
General Electric (GE) - Get Report reportedly was close to an agreement to combine its jet-leasing business with Ireland’s AerCap (AER) - Get Report in a deal valued at more than $30 billion, The Wall Street Journal reported, citing people familiar with the matter.
The deal would merge the world’s two biggest aircraft financiers during a tough time for the aviation business, which has been hit hard by the coronavirus pandemic.