- Zoom tumbles following a faster-than-expected drop in demand
- Apple Reaches High Level Of Its Life, As Tech Looms Big
- All major indices show strong monthly performance
Aug.31 (Reuters) – The main Wall Street indices closed slightly lower on Tuesday, although the slightly subdued end of August did not detract from a strong monthly performance in what is traditionally seen as a quiet period for the actions.
Having all posted lifetime highs in the second half of the month, including four record-breaking five-session closings for the S&P 500 before Tuesday, all three benchmarks were weighed by technology stocks on the last day of August.
For the S&P, this was a seventh straight month of gains, reflecting the level of investor confidence in US stocks derived from the Federal Reserve’s still-accommodating tone towards cutting its massive stimulus package.
“After all the monetary and fiscal interventions, the question is, where do we go from here? Is the S&P going to 5,000 and how does it get there?” said Eric Metz, CEO of SpringRock Advisors.
While a strong rebound in economic growth and corporate earnings boosted US stocks in August, investors are concerned about the increase in coronavirus cases and the direction of Fed policy.
A Reuters poll last week showed strategists believe the S&P 500 is expected to end 2021 not far from its current level. Read more
“Where will the leadership come from so that the actions take height?” Is it earnings growth, is it growth relative to value, technology or energy? This needs to be defined, but I think the next step for equities will be sector driven, “Metz added.
Tech stocks have continued to garner investor interest in recent days, given the benefits lower rates have on their future earnings, although the industry index (.SPLRCT) was among the worst performers on Tuesday.
Apple shares (AAPL.O) fell after hitting a lifetime high in the previous session, while Zoom Video Communications Inc (ZM.O) fell reporting faster than expected easing in demand for its videoconferencing service after a boom caused by the pandemic. Read more
A majority of the top 11 S&P sectors fell. Among those that did not were the real estate (.SPLRCR) and communications services (.SPLRCL) indices, which had reached intraday highs earlier in the session.
Unofficially, the Dow Jones Industrial Average (.DJI) lost 41.42 points, or 0.12%, to 35,358.42, the S&P 500 (.SPX) lost 6.13 points, or 0.14%, at 4,522.66 and the Nasdaq Composite (.IXIC) lost 6.28 points. , or 0.04%, to 15,259.61.
Reporting by Shashank Nayar in Bengaluru and David French in New York; Editing by Aditya Soni and Lisa Shumaker
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