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Stocks Waver After S&P 500 Hits Record

04/08/2021 | 07:47am

By Anna Hirtenstein

U.S. stocks were mixed after the opening bell, as investors awaited comments from Federal Reserve Chairman Jerome Powell.

The S&P 500 climbed 0.3% after closing at its 18th record this year on Wednesday. The Nasdaq Composite advanced 0.8%, while the Dow Jones Industrial Average slipped 0.1%.

Stocks have started the second quarter on strong footing, with the S&P 500 rising 2.7% this month. The largest tech companies have surged ahead as the bond market calmed, easing concerns about the high valuations of growth stocks. Fed policy makers' comments, released on Wednesday, highlighted their intention to continue with easy monetary policies until the economy has recovered more.

"The dynamic remains supportive for stocks," said Adrien Pichoud, a portfolio manager and chief economist at SYZ Private Banking. "The Fed and central banks in general are perceived to be in no rush to raise rates."

At 12 p.m. ET, Mr. Powell will be speaking about the global economy at the International Monetary Fund's virtual spring meetings.

The latest data on jobless claims showed that layoffs rose for a second week, highlighting the unevenness of the economic recovery. Worker filings for initial unemployment benefits rose to 744,000 last week, from a revised total of 728,000 the prior week. Economists surveyed by The Wall Street Journal were expecting a decline to 694,000.

In bond markets, the yield on the 10-year U.S. Treasury note ticked up to 1.662%, from 1.653% on Wednesday. It had climbed as high as 1.749% at the end of last month. Yields rise when bond prices fall.

The cooling off in bond yields has led to a revival in the largest technology stocks' rally. Apple, Microsoft, Amazon.com and Google's parent Alphabet -- which are the biggest companies by market value on the S&P 500 -- have each climbed over 4% this month after stumbling in March.

"We consider bond yields to be close to the top, so one of the barriers to tech has begun to come down," said Seema Shah, chief strategist at Principal Global Investors. "If there ever was going to be a test for tech, it would be this environment, with rising bond yields and the work-from-home trade starting to fade, but tech has remained really resilient in the face of that."

In premarket trading, Twitter rose 1.1%. Bloomberg News reported that the company had considered acquiring social-media app Clubhouse. The talks ended, Bloomberg reported, adding that it wasn't clear why they stalled.

Overseas, the pan-continental Stoxx Europe 600 ticked up 0.4%.

Among European equities, Amundi rose over 3%, climbing for a second day after the French asset manager entered into exclusive talks with Société Générale to buy some of the bank's asset-management businesses.

In Asia, most major benchmarks climbed. The Shanghai Composite Index added less than 0.1%, and Hong Kong's Hang Seng Index rose 1.2%.

Write to Anna Hirtenstein at anna.hirtenstein@wsj.com

(END) Dow Jones Newswires

04-08-21 0947ET

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