US stocks surge to end volatile session - RTHK
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US stocks surge to end volatile session

2021-03-06 HKT 05:09
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  • All three main indexes bounced back from losses earlier in the day. Photo: Shutterstock
    All three main indexes bounced back from losses earlier in the day. Photo: Shutterstock
Wall Street ended sharply higher after a volatile session on Friday, with the Nasdaq rebounding at the end of a week that saw it extend losses to about 10 percent from its previous record high.

All three main indexes bounced back from losses earlier in the day, with investors in recent sessions spooked by rising interest rates that offset optimism about an economic rebound.

Microsoft rallied 2.15 percent, boosting the S&P 500 more than any other stock, with gains in Alphabet, Apple and Oracle also lifting the index.

The benchmark 10-year US Treasury yields hit a new one-year high of 1.626 percent after non-farm payrolls increased by 379,000 jobs last month, blowing past a rise of 182,000 forecast by economists polled by Reuters.

Focus is also on a US$1.9 trillion coronavirus aid bill as a sharply divided US Senate began what was expected to be a long debate over a slew of amendments on how that money would be spent.

The Nasdaq logged its third straight weekly decline after a recent spike in Treasury yields dented demand for high-flying technology stocks.

Rising interest rates disproportionately hurt high-growth tech companies because investors value them based on earnings expected years into the future, and high interest rates hurt the value of future earnings more than the value of earnings made in the short term.

The tech-heavy Nasdaq is around 8 percent below its February 12 closing high.

Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma, said his firm in recent days has bought shares in a handful of growth companies whose prices have been pummelled in the recent selloff.

"Next week, I would expect volatility to continue, with pockets of opportunity, with certain things that sold off potentially rebounding," Dollarhide said.

The Dow Jones Industrial Average rose 1.85 percent to end at 31,496 points, while the S&P 500 gained 1.95 percent to 3,842.

The Nasdaq Composite climbed 1.55 percent to 12,920. (Reuters)