Wednesday’s bull market conducted a tidy but emphatic rotation — out of the beloved tech-oriented giants and into a broader range of industries. Signs of the greater economy returning closer to normal helped the S&P 500 post another record closing high, along with the Nasdaq, which crossed the 12K benchmark for the first time in history. The S&P 500 finished +1.53%, the Nasdaq +0.98% and the Dow, within 2% of its own all-time high, was +1.59%.
For once, as mentioned, this run-up was not led by Tesla TSLA — which fell 6% on a reported sell-off from a major investor, likely on the news of the $5 billion stock offering following its 5-for-1 split Monday — nor Apple AAPL or salesforce CRM, both down around 2%. Instead, we saw big advances for companies envisioned to succeed in the post-COVID world: AMC Entertainment AMC was +16% on news it was reopening many of its movie theaters nationwide, Starbucks SBUX came in +3% as people venture past their front gates once again, and Facebook was +7% because… well, because it’s Facebook.
Industry leaders for the regular session were far from the usual suspects: Utilities and Real Estate were stronger, while Tech only saw modest gains. All major sectors posted gains Wednesday besides Energy, which somehow missed any price-firming following the Gulf Coast destruction of Hurricane Laura last week.
This morning’s ADP ADP private sector payroll report came in well below expectations, which continues another curious narrative in the present market scenario whereby economic data — good or bad — has little effect on trading appetites. We’ll see if this changes at all with Friday’s non-farm payroll report, which expects to have garnered 1.2 million new jobs last month. Factory Orders for July came in exactly as anticipated, at +6.2%.
Otherwise, investors will continue to enjoy the froth in this economically overvalued but impressively resilient market.
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