Bargain-hunting buoys Wall Street after Nasdaq correction


The Nasdaq logo is displayed on the grounds of the Nasdaq market in Times Square on December 3, 2021 in New York City, USA. REUTERS/Jeenah Moon/File Photo

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  • Peloton falls after Report Co halts production
  • Travelers soar after reporting record quarterly profit
  • Baker Hughes jumps on Q4 earnings announcement
  • Indices up: Dow 0.76%, S&P 0.9%, Nasdaq 1.23%

Jan 20 (Reuters) - Wall Street's main indices rallied on Thursday with solid gains for technology and growth stocks as Treasury yields stabilized and investors sought bargains a day after the Nasdaq tumbled into correction territory.

All 11 major sectors of the S&P 500 were higher. Megacap stocks were the biggest individual drivers for the S&P 500, with Microsoft (MSFT.O) up 1.7% and Tesla (TSLA.O) up 3.8%.

Stocks regained some ground after a sharp sell-off earlier in the week, with the Nasdaq closing 10.7% below its November all-time high on Wednesday, confirming it was in a correction.

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"The fact that the Nasdaq dipped into correction territory likely attracted some buyers who felt it had been overdone," said David Joy, chief market strategist at Ameriprise Financial.

The Dow Jones Industrial Average (.DJI) was up 267.62 points, or 0.76%, to 35,296.27, the S&P 500 (.SPX) was up 40.77 points, or 0.90%, to 4,573.53 and the Nasdaq Composite (.IXIC) is up 175.69 points, up 1.23% at 14,515.94.

Shares in Peloton Interactive (PTON.O) dampened the recovery in growth stocks by 15% on Thursday after CNBC reported that the exercise bike maker is halting production of its connected fitness products as demand slows and the company tries to control costs. Peloton has been a mainstay of the stay-at-home trade in 2020.

Equities have had a bumpy start to 2022 as a rapid rise in Treasury yields amid fears that the Federal Reserve will become aggressive in controlling inflation has hit technology and growth stocks in particular. The benchmark S&P 500 is down about 4% so far this year.

Treasury yields were relatively stable on Thursday after falling from a two-year high on Wednesday.

"Just the fact that they didn't go higher...at least for the day, that's a welcome respite from the steady upward march we've been experiencing," Joy said.

Investors will also turn to the fourth quarter earnings reports as they come in.

Travelers Cos shares rose 4.9% after the property and casualty insurer reported a record quarterly profit.

Baker Hughes (BKR.O) shares rose 4.5% after the company reported adjusted quarterly earnings, beating analysts' earnings expectations as higher energy prices fuel demand for its equipment and services.

Streaming giant Netflix was due to report in one of the first reports for large growth companies after the market close on Thursday.

Data on Thursday showed the number of Americans filing new jobless claims rose unexpectedly last week, likely as a winter wave of COVID-19 infections disrupted business operations.

Rising issues predominated on the NYSE at a 2.41 to 1 ratio; on the Nasdaq, a 2.05 to 1 ratio favored movers.

The S&P 500 posted 11 new 52-week highs and a new low; the Nasdaq Composite posted 15 new highs and 162 new lows.

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Reporting by Lewis Krauskopf in New York, Bansari Mayur Kamdar and Shreyashi Sanyal in Bengaluru; Edited by Aditya Soni and Lisa Shumaker

Our standards: The Thomson Reuters Trust Principles.


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