The Nasdaq index was scheduled to open lower on Tuesday as investors continued to move away from mega-cap growth stocks to companies that stand to benefit from reopening economies.
Popular tech companies such as Microsoft Corp (MSFT.O), Alphabet Inc (GOOGL.O), Apple Inc (AAPL.O), Amazon.com Inc (AMZN.O) and Facebook Inc (FB.O) fell 0.6% and 1.7% in pre-marketing.
The US and European stock markets also saw a sudden 0.5% drop in significant volumes around 7:30 am ET on Tuesday, leaving traders scratching their heads and calling it a “micro-flash crash.” Read more
Numerous stimulus measures, rapid vaccination campaigns and the Federal Reserve’s dovish policy have spurred a strong rebound in the US economy and pushed Wall Street to record levels this year. The so-called “pandemic winners”, however, have recently started to fall from grace.
“While mega-cap tech companies have played a critical role in the strong performance of portfolios throughout the pandemic, we believe investors should be careful to avoid over-allocation to this part of the market,” Mark wrote. Haefele, Chief Investment Officer at UBS Global Wealth Management. in a customer note.
“In an environment of accelerating growth, we continue to favor cyclical and value sectors such as finance and energy. “
Planemaker Boeing Co (BA.N) rose 0.2%, while oil company Chevron Corp (CVX.N) rose 0.7%.
As of 8:38 a.m. ET, Dow e-minis were down 136 points, or 0.4%, S&P 500 e-minis, 22.25 points, or 0.53%, and e-minis of Nasdaq 100, 113 points, or 0.82%.
Among other actions, Pfizer Inc (PFE.N) rose 1% by increasing its annual sales forecast for the COVID-19 vaccine that it co-developed with Germany’s BioNTech SE. Read more
CVS Health Corp (CVS.N) gained 1.7% reporting first quarter profit higher than analyst estimates and increasing its profit forecast for 2021. Read More
Dupont (DD.N) edged up 0.5% after the industrial materials maker raised its full-year profit and revenue forecast and beat first-quarter expectations. Read more
The first quarter results were largely optimistic. According to IBES data from Refinitiv, average profits of S&P 500 companies are expected to have risen 46% in the quarter, compared to expectations of 24% growth in early April.
Investors were also awaiting data throughout the week, including data on non-farm payrolls from the Ministry of Labor, which is expected to be released on Friday. The report is expected to show an increase in job additions in April.
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