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Nasdaq Reaches New Record Closing High, But Dow Sees Further Downside

wallstreet4 061518 19nov21 lt

Following the mixed performance seen in the previous session, the major U.S. stock indexes once again moved in opposite directions during trading on Friday. While the tech-heavy Nasdaq reached a new record closing high, the Dow moved lower for the third straight session.

The Nasdaq climbed 63.73 points or 0.4 percent to 16,057.44, but the Dow slid 268.97 points or 0.8 percent to 35,601.98. Meanwhile, the S&P 500 spent the day bouncing back and forth across the unchanged line before closing down 6.58 points or 0.1 percent at 4,697.96.

The major averages also turned in a mixed performance for the week. The Nasdaq jumped by 1.2 percent and the S&P 500 rose by 0.3 percent, while the Dow slumped by 1.4 percent.

Renewed Covid-19 concerns weighed on cyclical stocks as a brutal fourth wave of the coronavirus pandemic sweeps across Europe.

Austria has announced a full national Covid-19 lockdown starting on Monday, while Germany has announced more restrictions on unvaccinated people.

The potential of more European countries reinstating full lockdowns sparked worries the pandemic could once again weigh down the global economy.

Meanwhile, the tech-heavy Nasdaq benefitted from continued strength among technology stocks following some upbeat earnings news.

Shares of Intuit (INTU) surged after the financial software firm reported better than expected fiscal first quarter results and raised its full-year revenue guidance.

Cybersecurity company Palo Alto Networks (PANW) also moved higher after reporting fiscal first quarter results that exceeded analyst estimates on both the top and bottom lines.

On the other hand, shares of Applied Materials (AMAT) came under pressure after the semiconductor equipment maker reported fiscal fourth quarter results that missed expectations and provided disappointing guidance.

Overall trading activity was somewhat, however, as a lack of major U.S. economic data kept some traders on the sidelines.

Sector News

Energy stocks saw substantial weakness on the day, moving sharply lower along with the price of crude oil. Crude for December delivery plunged $2.91 to $76.10 a barrel.

Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index dove by 4.6 percent, the NYSE Arca Oil Index plummeted by 3.9 percent and the NYSE Arca Natural Gas Index tumbled by 2.2 percent.

A decrease by the price of gold also contributed to weakness among gold stocks, resulting in a 1.9 percent slump by the NYSE Arca Gold Bugs Index.

Telecom, airline and banking stocks also saw notable weakness on the day, while some strength was visible among biotechnology and utilities stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Friday, although Hong Kong's Hang Seng Index bucked the uptrend and slumped by 1.1 percent. Japan's Nikkei 225 Index rose by 0.5 percent, while China's Shanghai Composite Index jumped by 1.1 percent.

Meanwhile, the major European markets moved to the downside on the day. While the U.K.'s FTSE 100 Index slid by 0.5 percent, the French CAC 40 Index and the German DAX Index both fell by 0.4 percent.

In the bond market, treasuries moved notably higher, extending the upward move seen over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dropped 5.3 basis points to 1.536 percent.

Looking Ahead

Reports on new and existing home sales, durable goods orders, and personal income and spending are likely to attract attention next week, although trading activity may remain somewhat subdued due to the Thanksgiving Day holiday.

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