Day Traders Diary
3/24/21
The major averages gave up earlier gains closing in the red as tech stocks sold off, continuing a market rotation out of high-flying growth names. The Dow Jones Industrial Average dipped into the red in the final seconds of the session, closing down 3 points at 32,420. The blue-chip benchmark jumped more than 300 points at its session high. The S&P 500 fell 0.55% to 3,889 after rising as much as 0.8%. The tech-heavy Nasdaq Composite dropped 2% to 12,961, closing at its session low. Apple, Facebook and Netflix all slid more than 2%, while Tesla fell 4.8%.
Classic reopening plays like airlines and cruise operators rolled over in afternoon trading. Shares of cruise operators fell to session lows after Centers for Disease Control and Prevention said the sailing order limiting cruises will stay in place until Nov. 1. Norwegian Cruise Line dropped 4.9% following the news, while Royal Caribbean and Carnival fell 1.9% and 2.8%, respectively. Delta and United Airlines also ended the day lower.
The tech sell-off came even as bond yields continued to decline from recent highs. The 10-year Treasury yield dipped 3 basis points to 1.61% Wednesday, falling for a third day after the rate hit a 14-month high last week.
One bright spot on Wednesday was the energy sector, which gained 2.5% as oil prices bounced back 6%. The material and financial sectors also outperformed, rising about 0.7% each.
On Wednesday, Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen appeared for a second day for virtual Capitol Hill testimony. Talking with members of the Senate Banking Committee, Powell said he expects the economy to experience superior growth in 2021 amid a recovery from the pandemic.
Shares of Intel wiped out earlier gains and fell more than 2% even after the chip giant unveiled plans for a comeback. The firm said it would open two new factories to manufacture chips for its own use and for other companies.
Investors are on edge as many regions of the world are seeing rising Covid-19 cases as highly contagious variants continue to spread. Germany and France are extending or enforcing new lockdown measures.
Still, expectations for a successful reopening in the U.S. remain high as the pace of vaccinations in the country is picking up with nearly one in five adults now fully vaccinated.
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