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The Nasdaq Is Leading the Market Higher.

Stocks’ recovery from their early plunge Thursday highlights a new dynamic at work in the market.

The Nasdaq Composite, followed by the S&P 500, were leading a turnaround in late afternoon after shares plummeted across the board, bringing an early loss of more than 700 points in the Dow Jones.

Technology stocks were surging, while the more economically sensitive names in the Dow were still under pressure.

In late trading, the Dow was down some 5 points, near the breakeven lline, while the Nasdaq was up 3.1% and the S&P 500 gained 1.2%.

Behind the swings was Russia’s invasion of Ukraine, and speculation about the western response.

The attack could compel western nations to impose heavy sanctions on Russian oil, though President Joe Biden said Thursday that the latest package of measures.

Targeting Russia’s oil exports would reduce the supply of crude available on the international market, causing the price to rise even further.

Inflation is already high, and the Federal Reserve has made it clear that it is likely to lift interest rates several times this year, not to mention reducing its bondholdings, in response.

The combination of tighter monetary policy and a rising price of oil could put significant pressure on economic growth.

That is a particular problem for the economically sensitive, or cyclical, stocks in the Dow, and it appears to have renewed interest in the tech names that dominate the Nasdaq.

Tech names were beaten down even before Thursday’s early plunge; the Nasdaq is far further from the record high it reached in late November than the Dow is from its peak in early January.

“Now, you have some uncertainty on global growth,” said Keith Lerner, co-chief investment officer at Truist.

Next: Bitcoin price falls after Russia attacks

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