Nasdaq at record high as Dow, S&P slip

he S&P 500 closed lower on Tuesday while the Nasdaq edged up to a record high, as investors balanced worries about the slowing pace of economic recovery with expectations that the Federal Reserve will maintain its accommodative monetary policy.

Amgen fell 2.1 percent and Merck & Co lost 1.6 percent after Morgan Stanley cut its rating on the stocks to “equal-weight” from “overweight”.

The Nasdaq was supported by Big Tech stocks that have fueled Wall Street’s gains in recent years. Apple rose 1.6 percent and Netflix added 2.7 percent, both hitting record highs.

“You could call it a gravitation toward Big Tech. As people feel a bit uncertain about how Covid will play out, you don’t have your reopening worries with those companies,” said Tom Martin, senior portfolio manager at Globalt Investments in Atlanta.

Tepid August payrolls data on Friday last week raised concerns that the economic recovery was slowing down.

On Tuesday, Morgan Stanley cut its rating on US stocks to underweight, pointing to risks related to economic growth, policy and legislation, and warning it expects the next two months to be “bumpy”.

Accommodative central bank policies and reopening optimism have pushed the S&P 500 and Nasdaq to record highs over the past few weeks, but concerns are growing about rising coronavirus infections due to the Delta variant and its impact on the economic recovery.

The Dow Jones Industrial Average fell 0.76 percent to end at 35,100 points, while the S&P 500 lost 0.34 percent to 4,520.

The Nasdaq Composite climbed 0.07 percent to 15,374.

Boeing dropped 1.8 percent after Ireland’s Ryanair said it had ended talks with the planemaker over a purchase of 737 Max 10 jets worth tens of billions of US dollars due to differences over price. (Reuters)