Nasdaq Reaches New Record High But Dow Gives Back Ground

Stocks are turning in a relatively lackluster performance in morning trading on Tuesday following the rally seen in the previous session. While the Dow is giving back ground, the tech-heavy Nasdaq has reached a new record intraday high.

Currently, the major averages are turning in a mixed performance. The Nasdaq is up 48.53 points or 0.5 percent at 10,482.18, but the Dow is down 138.79 points or 0.5 percent at 26,148.24 and the S&P 500 is down 1.22 points or less than a tenth of a percent at 3,178.50.

The choppy trading on Wall Street comes amid a quiet day on the U.S. economic front, with traders waiting on further evidence of a swift economic recovery.

The economic calendar remains relatively light throughout the week, although reports on weekly jobless claims and producer price inflation may attract some attention in the coming days.

Traders may also be taking a breather following the strong upward move seen in recent sessions, which saw the Nasdaq and the S&P 500 close higher for five consecutive sessions.

The Nasdaq ended Monday’s trading up by more than 57 percent from its March low, as technology companies are seen as holding up relatively well in the face of the coronavirus-induced economic downturn.

The continued advance by the Nasdaq partly reflected a spike by shares of Novavax (NVAX), which are currently soaring by 26.2 percent.

The rally by Novavax comes after the biotechnology company announced it has been awarded $1.6 billion in funding by the federal government’s Covid-19 vaccine development program.

Solar energy company Vivint Solar (VSLR) is also seeing substantial strength after agreeing to be acquired by rival Sunrun (RUN) for approximately $1.5 billion in stock.

Meanwhile, notable losses by Boeing (BA), American Express (AXP) and Goldman Sachs (GS) are contributing to the retreat by the Dow.

Most of the major sectors are showing only modest moves in morning trading, contributing to the lackluster performance by the broader markets.

Airline stocks have shown a substantial move to the downside, however, with NYSE Arca Airline Index plunging by 2.4 percent

Significant weakness is also visible among oil service stocks, as reflected by the 1.8 percent slump by the Philadelphia Oil Service Index. The index spiked by 3.2 percent on Monday.

The pullback by oil service stocks comes even though the price of crude for August delivery is edging up $0.15 to $40.78 a barrel.

Banking and computer hardware stocks are also seeing considerable weakness on the day, while gold stocks have moved sharply higher amid an increase by the price of the precious metal.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan’s Nikkei 225 Index fell by 0.4 percent, while China’s Shanghai Composite Index rose by 0.4 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the U.K.’s FTSE 100 Index has tumbled by 1.4 percent, the German DAX Index is down by 0.9 percent and the French CAC 40 Index is down by 0.7 percent.

In the bond market, treasuries have pulled back near the unchanged line after seeing initial strength. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 0.679 percent.

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