Dow jumps 556 points as investors rotate out of tech stocks
The Dow Jones Industrial Average rose 556.21 points, or 1.1%, to 52,177.69 on Thursday, the AP reported. Investors moved out of AI stocks and into health care and consumer names, Reuters reported. The S&P 500 rose 0.3% after erasing an early loss, and the Nasdaq added 0.1%.
U.S. stocks closed higher Thursday as investors moved money out of AI-related stocks and into health care and consumer stocks, Reuters reported.
The Dow Jones Industrial Average rose 556.21 points, or 1.1%, to 52,177.69, the AP reported. The S&P 500 rose 25.12 points, or 0.3%, to 7,744.06 after erasing an early-morning loss, and it pulled closer to its record high set last week. The Nasdaq composite rose 20.16 points, or 0.1%, to 26,713.03. The Russell 2000 index of smaller companies rose 37.74 points, or 1.4%, to 2,767.27. Reuters reported the same closes for the Dow, the S&P 500 and the Nasdaq.
Eli Lilly gained over 3%, UnitedHealth added 2.8% and Walmart rose 1.4% after rating upgrades by Deutsche Bank, Reuters reported. Those three were heavy contributors to the S&P 500's gain. Eight of the 11 S&P 500 sectors rose, led by health care, up 1.84%, Reuters said.
Tech stocks lagged. Nvidia dipped 1.8%, Dell Technologies dropped 6.9% and Hewlett Packard Enterprise fell 7.1%, Reuters reported. The Philadelphia semiconductor index fell 0.9%, its seventh straight decline. Investors were weighing AI companies whose debt loads leave them exposed to rising interest rates, Reuters said.
"The best performing stocks today are the non-cyclical, defensive businesses," Jed Ellerbroek, a portfolio manager at Argent Capital Management, told Reuters.
The gains came a day after the Nasdaq and S&P 500 had their worst days since July, after a hotter-than-expected September consumer inflation report, Investopedia reported. On Thursday, data showed producer prices rose the most in 4-1/2 years in September, Reuters reported. Retail sales rose 0.8% and weekly jobless claims came in at 199,000, Investopedia reported.
Traders now see a 67% chance the Federal Reserve will raise rates by its December meeting, up from 62% on Wednesday, according to CME's FedWatch tool, Reuters reported at 4:14 p.m. ET. The 10-year Treasury yield retreated but stayed near multiyear highs, Reuters said.
For the week, the S&P 500 is down 0.9%, the AP reported.
What we know: The Dow gained 1.1% as money moved from tech to defensive stocks.
What we don't: Whether the shift out of AI stocks will last, or how the Fed will act.
Where outlets agree The AP and Reuters report the same closing levels, with the Dow up 1.1% to 52,177.69 and the S&P 500 at 7,744.06.
Where they differ The outlets cited here report the same key facts so far.