The Dow Jones Industrial Average recovered its decline after Fed Chairman Jerome Powell's congressional testimony eased concerns about rising interest rate and inflation.
------------ The Dow fell 360 points during the session, closing up 15.66 points or 0.05%, closing 31,537.35 points.
----S&P rose 4.87 points or 0.13% after falling 1.8% intraday, closing at 3881.37 points.
----------Nasdaq Composite Index fell 67.85 points or 0.5%, closing 13,465.2 points, and fell 3.9% intraday, the first time since November 3 that it fell below the key technical indicator 50-day moving average .
Powell said in Congress that inflation remained weak and the economic outlook remained highly uncertain, alleviating concerns about Fed's policy change and stocks rebounded from lows.
He said: The economy is still far from the Fed's employment and inflation targets, and it may take some time to make further substantial progress.
In recent weeks, bond yields have risen sharply as Congress argues about another round of economic bailout, fears about inflation have increased; investments people worry that soaring prices due to federal bailouts could force Fed to raise short-term borrowing costs.
Bleakley Advisory Group Investment Director Peter Boockvar said in the report that Fed is focused on employment and seems very willing to absorb higher inflation and excessive signs of turmoil in financial markets to achieve his goal; but from the long end of the yield curve, the stock market is also speaking out, and he highly demands that Fed officials listen attentively.
After Powell's speech, technology stocks hit by high interest rates recovered their losses. After Tesla fell 9% on the previous trading day, it once fell 13% at the opening and closed down only 2.19%. Apple fell just 0.11% after falling more than 2% in the early trading session.
The best performing energy and financial stocks this year once again provide support for the stock market as investors scramble to these stocks , which are considered to benefit from the economic recovery. Energy stocks rose 1.6%, bringing their 2021 gains by more than 27%.
Jonathan Golub, chief U.S. equity strategist at Credit Suisse, believes that cyclical stocks will push stocks to new highs by the end of this year due to profit-taking growth and optimism about economic reopening.
In his report, he said: Rising interest rates are beneficial to the financial industry, and rising copper and oil prices are boons for the industry, energy and materials industries, further expanding this positive background.
Credit Suisse raised S&P's year-end target price from the previous 4,200 points to 4,300 points. It means there is still room for rebound of 11.5%.
small-cap stocks performed poorly, with the Russell 2000 falling 0.9%, reducing February's gains to 7.6%. Stocks that fell sharply last year outperformed the S&P in 2021 as investors were optimistic about vaccine rollouts and economic reopening. Chris Larkin, general manager of trading and investment products at
E-Trade, said: The sell-off of tech darlings and much-loved small-cap stocks may be interpreted as the beginning of stock market turmoil; this does not mean that the stock market has changed its course, but cyclical industries such as energy and finance are more attractive, while technology stocks have temporarily faded.
Since the beginning of 2021, the 10-year U.S. Treasury bond yield has been rising steadily, maintaining at around 1.36% on the 23rd. The indicator interest rate has risen by 28 basis points this month. The 30-year Treasury bond yield hit a one-year high of 2.2% on the 22nd. 1 basis point is 0.01%.
Focus stocks
The blockchain sectors such as Canaan Technology (17.76, -3.09, -14.82%), Marathon Patent, China Network Line (3.36, -0.70, -17.24%) have collectively fallen.
Hot Securities (27.98, -3.12, -10.03%), Futu (167.19, -7.33, -4.20%) Holdings and other popular Chinese stocks, especially securities companies, fell sharply.
Electric vehicle manufacturer Tesla (698.84, -15.66, -2.19%) stock price fell sharply, and fell below the level of the time when it was included in the S&P 500 index in December last year.As of Monday's close, its share price fell 21% from the intraday record high set on January 25.
Earlier this week, the market was generally sold out, and Tesla also fell. Part of this is because its CEO Musk commented over the weekend that Bitcoin and Ether prices “do seem to be high.”
L Brands will sell Victoria's Secret to private equity funds.
Ctrip's stock price rose sharply. The company plans to list in Hong Kong in April to raise US$1 billion to US$2 billion.
Xiaopeng Motors' stock price fell, and the ban on sale expired today.
Ruitu Ecology's stock price rose. It is reported that the company will announce more news about the 2022 Beijing Winter Olympics.
Aurora (6.23, 0.59, 10.46%) company signed a contract with BYD DiLink to work together to promote the digital upgrade of the new energy vehicle industry.
Keban Capital upgraded iQiyi (24.75, 0.87, 3.64%) rating from a flat industry to an outperforming market.
Other markets
European stocks closed mixed on Tuesday, with the German DAX30 index falling 0.62% to 13863.10 points; the UK FTSE 100 index rose 0.21% to 6626.16 points; the French CAC40 index rose 0.22% to 5779.84 points; the European Stoke 50 index fell 0.29% to 3688.95 points.
