The stock market today: Dow broke records when technology stocks stumbled

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The major stock indices ended mixed on Tuesday, although the market had a better day than it appeared on the surface. Economic data showed that supply chain restrictions are easing, which means that Dow’s momentum from December can continue.

The

Dow Jones Industrial Average
ended up 215 points, or 0.6%, and broke the final record set on Monday. The Dow index has now risen more than 5% from its lowest point on December 20, 2021. They

S&P 500,
meanwhile, the day ended 0.1% after it also closed a new record in Monday’s session. The technology-heavy

Nasdaq Composite
fell 1.3 percent.

While technology stocks pulled the indices down, most stocks were up. The Invesco S&P 500 Equal Weight Exchange-Traded Fund (RSP), which weights each stock in the index equally and therefore shows the movement of the average stock, rose 0.8%.

The Department of Supply Management’s production index fell to 58.7 in December, and lacked expectations of 60 and fell from a previous reading of 61.1. But the latest report contained some encouraging signals.

The constraints in the supply chain are getting better. This means slower cost increases for companies, which in turn provides less incentive for them to increase prices and contribute to inflation. The price index fell to 68.2 from 82.4. Delivery times for suppliers also decreased. “Supply chain pressure leading to longer delivery times and rising prices may ease,” wrote Andrew Hollenhorst, Citigroup economist.

This provides more assurance that the Federal Reserve will not act too quickly when it comes to raising interest rates.

Data on vacancies for November also contributed to that narrative. The number of vacancies was 10.6 million, below estimates of 11.1 million and less than the previous result of 11.1 million, after a record high 4.5 million Americans quit their jobs. Fewer openings mean that companies are not in as intense a search for labor as expected, which can slow down the pace of wage increases and therefore slow down inflation.

The stock market reflected investors’ optimism in long-term economic growth on Tuesday. All indications that the Fed will be less aggressive when it comes to raising interest rates are an indication that economic growth may be higher, not lower. The more economically sensitive value stocks outperformed growth stocks on Tuesday. «Higher prices [Treasury yields] and financial hopes help, “wrote Andrew Brenner of NatAlliance Securities.

In fact, higher bond yields weighed on technology stocks. The 10-year government bond yield climbed to 1.66%, after rising Monday from a 1.51% close on Friday. The interest rate level is approaching the highest level in the pandemic period of 1.75%. The higher return reflects higher expectations for long-term inflation, which is bad for technology stocks that expect profits well into the future.

Overall, the stock market has been in a good mood lately. The Santa Claus rally, when the market rises at the end of December when people finance their pension accounts and others position themselves to hold more shares at the end of the year, has continued into the new year. In two trading days before 2022, the S&P 500 is up 0.6%.

West Texas Intermediate crude oil futures rose 1% to more than $ 77 a barrel, even after OPEC said it would increase production as the global economic recovery continues on the right track. “This will be encouraging for investors and can keep oil prices high,” wrote Craig Erlam, senior market analyst at Oanda.

Overseas, London

FTSE 100
jumped 1.6% when British traders began their first session in 2022 after a holiday Monday. In Tokyo is

Nikkei 225
surpassed its Asian competitors and rose 1.8%.

Hong Kongs

Hang Seng
the index just finished above flat and it

Shanghai composite
fell 0.2 percent.

On top of China’s Covid-19 pressure, the central bank has moved to drain liquidity. The People’s Bank of China reduced its short-term cash injections on Tuesday, leading to the biggest liquidity slump since October, Bloomberg reported.

Here are six stocks on the way Tuesday:

After reaching a market value of $ 3 trillion on Monday – the first public company in the world to reach that market value –

apple (ticker: AAPL) was down 1.3% on Tuesday.

Cruise line

Carnival Corp. (CCL) rose 1.5% after a jump of 6.4% on Monday. Cruise ship shares have largely sailed upwards, despite the impact of Omicron on their operations, including an increase in cases among passengers across their fleets.

Despite agreeing to postpone the rollout of a new 5G service by two weeks due to aviation safety concerns,

AT&T (T) and

Verizon (VZ) stocks were resistant, up 0.8% and 2% respectively.

SunPower (SPWR) stock fell 0.1% even after being upgraded to Outperform from Market Perform at Raymond James.

Under Armor (UAA) shares rose 0.8% after being upgraded to Outperform from Neutral at Baird.

Write to Jack Denton at jack.denton@dowjones.com and Jacob Sonenshine at jacob.sonenshine@barrons.com