U.S. equities mostly lower on Thursday as declines in tech offset a rally in energy and financial stocks, while investors digested economic data.
The Dow Jones industrial average rose about 65 points, with Goldman Sachs contributing the most gains. The S&P 500 fell about 0.4 percent, with information technology falling 2.2 percent while energy and financials gained 0.8 percent and 1.5 percent, respectively.
"What we're seeing here is a vicious rotation out of sectors that were leading before the election and into sectors that have led since," said Adam Sarhan, CEO at 50 Park Investments. "The damage being done can't be ignored." "That type of rotation is not seen in young, healthy bull markets."
The Nasdaq composite underperformed, falling about 1 percent as the so-called Apple and most of the so-called FANG stocks (Facebook,Amazon, Netflix and Google parent Alphabet) fell. The Nasdaq 100 shed more than 1.5 percent, giving up its post-election gains.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded nearly 7 percent higher, 14.3. "There's a lot of speculation about what's going to happen with taxes, regulation, trade policy, etc.," said John Stadtler, head of U.S. Financial Services at PwC. 1
Energy stocks were boosted by even more sharp gains in oil. West Texas Intermediate futures for January delivery rose 3.28 percent to settle at $51.06 per barrel, a day after spiking more than 9 percent. On Wednesday, OPEC and Russia agreed to restrict production, even as analysts warned other producers were likely to top up supply.
Jeremy Klein, chief market strategist at FBN Securities, said in a note that he expects crude to trade above $60 by next summer. " I reiterate that the fundamental story surrounding the commodity will flip from one fraught with supply concerns to one optimistic about burgeoning global demand," he said. 1
Gold prices ended the U.S. day session modestly lower Thursday and sunk to another 10-month low. The technical postures for both gold and silver markets remain solidly bearish. Fundamentally, traders and investor optimism remain generally upbeat and that’s also negative for safe-haven gold. February Comex gold was last down $4.50 an ounce at $1,169.40. March Comex silver was last up $0.043 at $16.525 an ounce. 2
