The five biggest winners on the Dow Jones Industrial Average Tuesday gained either because they are defensive in nature or because of a company-specific catalyst. Market sentiment was mixed.
The 10-Year Treasury yield was moving in a narrow range between up to 0.68% and down to 0.67%. Yields fall when prices rise. Crude oil ranged between up 0.8% and down a few ticks. Many economically-sensitive stocks like banks, oil and materials were down on the day. Comments Tuesday from Federal Reserve members, especially from Chairman Jerome Powell speaking to Congress, are yet another guidepost pointing investors away from risk-assets. That’s unless Congress unleashes more fiscal stimulus, which the speed of the economic recovery is somewhat dependent on.
Large-cap growth tech stocks rebounded from a 13% correction this month, as valuation concerns have been priced in and investors looking for secular growth trends during economic uncertainty scoop up some battered names.
Here were the 5 biggest gainers on the Dow by 2:40 PM EDT:
Nike is cyclical — a consumer discretionary — but it has earnings Tuesday (see TheStreet.com) and investors were picking up shares ahead of the release. .
Microsoft rose along with big tech, but it didn’t hurt that it got some positive commentary from Mizuho Securities analysts, saying the company’s $7.5 billion all-cash acquisition of ZeniMax Media can help boost the company’s position in the gaming business. Some investors are also encouraged by Microsoft’s push to gain access to the consumer and potentially create synergies for its broader software offerings.
Amgen is a biotech company uncorrelated to the economic cycle.
Procter and Gamble is a classic defensive consumer staples company.
Disney is fairly cyclical, with its sports advertising reliance and its highly discretionary theme parks business, which recently has been said to be reopening up in China. That’s a major positive for the stock.
Still, furthering the narrative that market sentiment Tuesday was mixed rather than poor, roughly half of the Dow was in the green, so it isn’t as if only a few stocks were carrying the entire market.