Stocks Open Higher After Nasdaq Enters Correction
U.S. stocks gained to start the day, putting indexes on course to pare some of the sharp losses that have come as investors reposition their portfolios, spooked by the prospect of tightening monetary policy and slowing growth.
The Nasdaq Composite Index rose 0.9% in early trading Thursday, a day after a late tech selloff dragged down indexes. The S&P 500 rose 0.4% and the blue-chip Dow Jones Industrial Average added 0.3%, or 101 points.
In individual stocks, Travelers Companies rose over 2% after reporting record net income in the fourth quarter.
Group also gained 2% after saying it had trimmed its losses.
will be one of the first tech giants to post its fourth-quarter results, after markets close, when
will also report.
The technology-heavy Nasdaq Composite shed 1.1% on Wednesday.
Photo:
BRENDAN MCDERMID/REUTERS
Hong Kong-listed Chinese stocks jumped after an interest-rate cut by China’s central bank lifted shares of property developers and tech giants. The Hang Seng Index rose 3.4%, while mainland China’s Shanghai Composite Index edged down 0.1%. Elsewhere in Asia, the Nikkei 225 rose 1.1%. The pan-continental Stoxx Europe 600 edged up 0.1%.
Faced with the prospect of multiple interest-rate rises, cooling growth and inflation at multidecade highs, investors have been reassessing the pandemic-era playbook that focused on outsize gains for growth stocks, such as tech. In recent sessions, investors have rotated into sectors expected to perform better in the coming year, such as financials and energy.
“I don’t see a whole lot in the market that is really alarming me. There is no one out there saying ‘run for the hills,’ but there are those saying they are going to take off risk and reposition to other areas of the market,” said
Kara Murphy,
chief investment officer of Kestra Holdings.
That has prompted tumultuous trading. On Wednesday, the Nasdaq Composite closed more than 10% below its all-time closing high, putting it in correction territory.
Investors are selling government bonds in anticipation of higher interest rates, pushing up yields, and in the process, pressuring tech companies, whose future earnings become less attractive when compared with bonds with rising yields.
The yield on the 10-year U.S. Treasury note was roughly flat…
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