- Meta climbs on report of more layoffs
- Fidelity National slumps on payments business spinoff
- Indexes up: Dow 0.58%, S&P 0.52%, Nasdaq 0.65%
Feb 13 (Reuters) – U.S. main stock indexes rose on Monday as investors piled into beaten-down megacap growth stocks with a decline in Treasury yields boosting sentiment, while Meta Platforms gained on reports the Facebook parent was planning fresh layoffs.
“(Investors) have been holding back during the regime of rate hikes because they believed it would kill the growth of technology type stocks,” said Peter Andersen, founder of Andersen Capital Management.
Andersen added that the Fed is now signaling that its near the end of its tightening cycle, which could provide an added boost to such high-growth firms.
All U.S. indexes clocked their worst declines last year since the financial crisis of 2008, led by a 33% slump in the tech-heavy Nasdaq (.IXIC), on fears that the Federal Reserve would tip the economy into a recession with its hawkish monetary policy.
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While money markets are expecting rates to peak to 5.2% in July, a resilient labor market has lifted hopes of a milder-than-expected recession.
Microsoft added 3.4% and was the biggest boost to the blue-chip Dow (.DJI) after brokerage Stifel said the tech-giant is clearly looking to up-end Alphabet’s Google Search dominance through its integration with ChatGPT.
Ten of the 11 major S&P 500 sector were in the black, with the energy sector’s (.SPNY) 1.1% fall making it the sole sector lower as crude oil prices slipped on caution ahead of domestic inflation data.
Markets now await January inflation on Tuesday and retail sales data later in the week to reassess their bets on the central bank’s monetary policy path.
At 10:12 a.m. ET, the Dow Jones Industrial Average (.DJI) was up 196.57 points, or 0.58%, at 34,065.84, the S&P 500 (.SPX) was up 21.17 points, or 0.52%, at 4,111.63, and the Nasdaq Composite (.IXIC) was up 75.59 points, or 0.65%, at 11,793.71.
Further buoying gains in megacap names was declining yields on the U.S. 10-year Treasury note after hitting a fresh six-week high earlier in the day.
A fall in Treasury note yields indicate traders expect greater return from investments in risky assets.
Advancing issues outnumbered decliners by a 2.26-to-1 ratio on the NYSE and by a 1.31-to-1 ratio on the Nasdaq.
The S&P index recorded three new 52-week highs and no new low, while the Nasdaq recorded 39 new highs and 41 new lows.
Reporting by Johann M Cherian in Bengaluru; Editing by Maju Samuel and Sriraj Kalluvila
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