Technology stocks continued their recent decline Monday, pulling the Nasdaq index into correction territory, as U.S. government bond yields continued climbing, making high-growth technology names a bit less attractive. On Monday, the yield on the 10-year U.S. Treasury ticked up to nearly 1.6%, its highest level since last February. Meanwhile, a rotation toward cyclical names continued, driven by the expectation that the $1.9-trillion stimulus package will be signed into law this week by U.S. President Biden. By Monday’s close, the Nasdaq dropped 311, the Dow climbed 306, and the S&P was down 20 points. In Canada, the TSX was up 77 points, buoyed by the Financials and Real Estate sectors.
North American markets rallied on Tuesday, with the Nasdaq recovering roughly 4% — its biggest single-day rise since early November — as U.S. bond yields retreated and investors looked for bargains in the technology sector. The TSX closed at a record high, gaining 141 points to end the day at 18,599. Meanwhile, the Dow hit a record intraday high but lost some ground later in the session, finishing up just 30 points.
The Dow, however, notched a fresh record Wednesday, climbing 462 points, after U.S. inflation data showed a negligible increase in consumer prices for February, easing investors’ inflation worries. The Nasdaq and S&P finished fairly flat, while the TSX added 91 points. As expected, the Bank of Canada on Wednesday held its overnight rate steady at 0.25%, noting once again its intention to keep rates low until 2023.
Technology shares, especially FAANG stocks, were once again in favour Thursday as fears of rising rates diminished somewhat, leading to an increased sense of calm in the bond market. The Nasdaq surged nearly 330 points, while the Dow and S&P added 189 and 41, respectively. It was a broad-based rally on Thursday with all 11 S&P sectors trading higher. In Canada, the TSX staged a rally of its own, jumping nearly 155 points to a new record close at 18,845.
source https://richarddri.ca/a-volatile-week-for-technology-stocks-as-signs-of-recovery-build/
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