(MarketWatch) — U.S. stocks ended mostly higher Tuesday after a choppy day of trading that saw the technology sector under pressure, with the Dow Jones Industrial Average and S&P 500 closing with gains while the tech-heavy Nasdaq Composite index fell.
Energy shares rallied, however, as oil prices bounced despite the White House announcing the U.S. would release crude from its Strategic Petroleum Reserve in a coordinated move with other countries to try to lower the cost of gasoline.
U.S. technology stocks extended their slide from the previous session as Treasury rates continued their climb.
The market may be pricing in a rise in interest rates beginning in the middle of next year, which is “not positive for long-duration assets like technology” stocks, said Wayne Wicker, chief investment officer at MissionSquare Retirement, in a phone interview Tuesday.
Monday’s late-day weakness in the stock market was tied by some analysts to expectations that Federal Reserve Chairman Jerome Powell — nominated to a second term by President Joe Biden earlier the same day — could tighten monetary policy faster than Lael Brainard, who was appointed Vice-Chair but had also been in the running for the top job.
Investors also were watching yet another resurgence of new coronavirus cases in Europe and Asia in particular, which have prompted another round of restrictions on businesses and consumers to try to limit infections.
In economic data, a pair of surveys by IHS Markit showed U.S. businesses grew rapidly in November, even as they’re still being hampered by labor and supply shortages that are feeding the biggest burst of inflation in 31 years.
The so-called flash survey of U.S. manufacturers rose to a two-month high of 59.1 in November from 58.4 in the prior month, while a similar survey of service-oriented companies fell to a two-month low of 57 from 58.7.
Across other markets, oil futures erased losses to turn higher after the White House announced a plan to release 50 million barrels of oil from the U.S. Strategic Petroleum Reserve, or SPR, in coordination with other countries. West Texas Intermediate crude the U.S. benchmark, rose 2.3% Tuesday to settle at $78.50 a barrel.
Trading is expected to thin out as the U.S. Thanksgiving Day holiday nears. U.S. markets will close Thursday for the holiday and open for a half-day on Friday.
- Shares of Zoom Video Communications fell 14.7% after company executives detailed falling revenue on a conference call late Monday.
- Best Buy shares tumbled 12.3% after the electronics retailer forecast holiday season comparable sales below expectations, though it reported a quarterly beat on the top and bottom lines.
- Abercrombie & Fitch shares dropped 12.6% after the retailer’s results beat forecasts and Chief Executive Fran Horowitz spoke of “ongoing supply chain constraints,” delivery delays and higher costs.
- Shares of XPeng Inc. rallied about 8.3% after the China-based electric vehicle maker reported a wider-than-expected third-quarter loss, but revenue above forecasts and delivered an upbeat fourth-quarter outlook.
- Dollar Tree shares rose about 9.2% after the retailer matched profit forecasts and topped expectations for sales, but saw falling gross margin and said it was moving to a $1.25 price point for all its stores.
- Gold futures fell 1.2% to settle at $1,783.80 an ounce.
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