The Dow Jones Industrial Average cut a nearly 500-point intraday loss Monday as technology names like Microsoft rallied amid falling interest rates.
The blue-chip average rose about 120 points, or 0.4%, after being down as much as 488 points earlier in the session. The S&P 500 ticked up 0.1%. The tech-heavy Nasdaq Composite gained 0.7%.
Concerns about a global economic slowdown amid Covid outbreaks in China sent interest rates lower. The 10-year Treasury yield pulled back to the 2.8% level.
Tech shares rebounded as rates fell, providing support to the major averages. Microsoft and Salesforce were among the Dow’s top gainers, each rising more than 1%.
Twitter rose about 5% after the social media company announced it accepted billionaire Elon Musk’s buyout deal valued at about $44 billion.
“We still see opportunity in equities,” J.P. Morgan Asset Management’s David Lebovitz told CNBC’s “Squawk on the Street” on Monday. “The sell-off in things like the Nasdaq we think has created some opportunity, particularly in those more profitable parts of the growth complex.”
The Nasdaq is off by more than 20% from its record, while the S&P 500 is back in correction territory, down roughly 11% from its high. The Dow is coming off its worst one-day performance since 2020 on Friday and four straight losing weeks. The S&P 500 and the Nasdaq fell for three consecutive weeks.
Wall Street is bracing for a stacked week of earnings, including reports from major technology companies like Amazon and Apple. About 160 companies in the S&P 500 are expected to report earnings this week, and all eyes will be on reports from mega-cap tech names, including Amazon, Apple, Alphabet, Meta Platforms and Microsoft.
“This week may easily be a fork in the road of equities. We have nearly a third of the S&P 500 and half of the Dow Jones set to report. Bottom-up drivers will either confirm or reject what the challenging macro backdrop has given us over the last three weeks,” MKM’s JC O’Hara said in a note.
Coca-Cola shares were marginally higher after the company reported better-than-expected quarterly earnings before the bell Monday.
On the downside, fears of a global slowdown sent oil prices lower. WTI crude fell more than 4%, back below $100.
Energy shares retreated, comprising the worst-performing S&P 500 sector Monday. Chevron fell more than 2% and was the second biggest decliner on the Dow. Exxon Mobil lost more than 3%.
