The Nasdaq Composite rallied to a record high on Tuesday, briefly breaking above 10,000 for the first time, as traders loaded up on major technology names while taking profits from stocks that benefit from the economy reopening.
The tech-heavy Nasdaq rose 0.3 percent to finish the day at a record close, but below the 10,000 mark it hit earlier in the session. Amazon and Apple gained 3 percent and 3.1 percent, respectively, with each notching all-time highs during the session. Facebook traded 3.1 percent higher and Netflix rose 3.47 percent. Google-parent Alphabet advanced 0.28 percent.
Meanwhile, the 30-stock Dow Jones Industrial Average slid 200 points, and the S&P 500 dropped 0.5 percent.
Tuesday’s moves came on the back of sharp gains a day earlier, with the S&P 500 returning to positive territory for 2020.
Traders say the market’s hot streak over the last two months is in large part thanks to confidence about the reopening of the U.S. economy and a barrage of government stimulus.
“Recent data points like the jobs report and not-as-bad-as-feared company updates have fueled the view that the worst of the declines could be behind us,” a team of RBC Capital Markets analysts told clients Monday. “The risk-on trade really is gaining traction. Valuations have spiked to historical highs in many industrial sub-sectors, signaling a strong recovery is potentially taking hold.”
All in, the S&P 500 is up 46 percent from its March low. Much of those gains have been thanks to the so-called reopening trade, which are stocks that would benefit the most once all the COVID-19 precautions and business closures are removed.