The Dow Jones Industrial Average pushed higher Tuesday after ending the first trading day of 2022 at a record, while technology stocks pulled back.
Shares of economically sensitive companies in the energy, financials and industrials sectors advanced, helping the blue-chip gauge outpace other major U.S. indexes. A retreat in big tech stocks, meanwhile, weighed on the S&P 500 and Nasdaq Composite.
The Dow industrials rose 0.5%, or about 168 points, building on a record set Monday. The S&P 500 dropped 0.4%, and the Nasdaq Composite fell 1.9%.
The divergence between different corners of the stock market occurred as investors parsed new data that showed expanding U.S. factory activity and a tight labor market.
A manufacturing sector survey showed signs that supply-chain problems could be improving. Separate data showed the number of times workers quit their jobs rose to a fresh high in November while job openings remained near record levels.
In bond markets, the yield on the benchmark 10-year U.S. Treasury note rose to 1.675% from 1.628% on Monday. Yields rise as bond prices fall.
Within the S&P 500, the energy sector advanced 3.3%, the financial sector rose 2.4% and the industrial sector gained 1.8%. The technology group declined 1.8%.
Traders tend to pile into tech stocks when economic concerns mount, betting those shares can deliver growth. When the outlook brightens, they often rotate into companies that can harness themselves to a strong economy.
Investors are also parsing data on the spread of the Omicron variant of Covid-19 as they try to forecast how the pandemic will affect the economy going forward. Cases hit a record in the U.S. and hospitalizations are rising but remain below pandemic peaks, according to data from Johns Hopkins University.
“The mildness of Omicron and therefore, potential for less disruption, less lockdown measures—all of these should feed directly into earnings expectations,” said James Athey, an investment manager at Abrdn.
Among individual stocks, Apple shares fell 1.4% after the company on Monday briefly touched $3 trillion in market value before closing below that threshold. Tesla shares dropped 3.6% after jumping 14% on Monday.
A number of travel stocks advanced. Royal Caribbean shares rose 1.8%, United Airlines shares gained 1.9% and Marriott International shares added 2.9%.
Oil prices rose after OPEC and a group of Russia-led oil producers agreed to keep pumping more crude in a bet that the global surge in Covid-19 cases won’t depress demand like earlier waves of the virus. Global benchmark Brent crude climbed 1.5% to $80.13 a barrel.
Bitcoin stabilized after a two-day fall, edging up 0.4% compared with its level at 5 p.m. ET Monday. It traded around $46,230, down 32% from its all-time high in November, based on 5 p.m. levels.
Overseas, the pan-continental Stoxx Europe 600 added 0.8% to close at a record.
In Asia, major benchmarks were mixed. The Shanghai Composite Index slipped 0.2% after fresh data showed that Chinese exports were broadly stagnant last month due to lackluster foreign demand, even as manufacturing activity rebounded.
Hong Kong’s Hang Seng Index edged up 0.1%. Japan’s Nikkei 225 closed up 1.8% as the weaker yen drew investors to the country’s stock market.
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