Nasdaq lags S&P, Dow as big tech weighs

(Reuters) -The S&P 500 and the Dow rose on Wednesday, while the Nasdaq lagged as investors shifted out of technology and into cheaper sectors that are poised to benefit from an eventual economic recovery.

FILE PHOTO: Raindrops hang on a sign for Wall Street outside the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020. REUTERS/Mike Segar

Investors also appeared to have shrugged off a threat from U.S. President Donald Trump to not sign an $892 billion coronavirus relief bill, saying it should be amended to increase the amount in the stimulus checks.

“Either we’ll get exactly what was passed, which is very positive for the economy, or we’ll get something even bigger and the market likes it either way,” said Thomas Hayes, managing member at Great Hill Capital Llc in New York.

Ten of the 11 major S&P sectors were higher, with energy stocks rising the most as investors clung to hopes of a sooner-than expected economic recovery on the back of easy monetary policy, high liquidity and a COVID-19 vaccine program.

Technology stocks including Microsoft, Paypal and, which have consistently outperformed during the pandemic, dragged the Nasdaq lower.

“Technology is going to be a major driver of growth, but at the same time there’s better value in the value segment of the market, and that’s especially true if the vaccine enables the economy to recover,” said Chuck Lieberman, chief investment officer of Advisor Capital Management in New Jersey.

Elsewhere, reports that the European Union and Britain were in the final stages of a Brexit trade deal also brewed some optimism in markets.

At 11:52 a.m. ET, the Dow Jones Industrial Average was up 211.00 points, or 0.70%, at 30,226.51, the S&P 500 was up 18.26 points, or 0.50%, at 3,705.52. The Nasdaq Composite was up 7.52 points, or 0.06%, at 12,815.43.

Data showed initial claims for state unemployment benefits fell last week but remained at elevated levels. A separate report showed consumer spending fell last month.

While the data painted a grim picture of the economy, major Wall Street indexes were still set to mark large annual gains on the back of unprecedented fiscal and monetary responses to the pandemic.

Drugmaker Pfizer Inc rose 2.3% after a deal to supply the United States with 100 million additional doses of its COVID-19 vaccine by July.

Merck & Co Inc added 0.9% following its own COVID-19 treatment agreement with the United States.

Electric-truck maker Nikola Corp plunged 10.1% after it called off a deal to develop electric garbage trucks with recycling and waste disposal firm Republic Services Inc.

American Airlines Group and United Airlines Holdings rose 2.9% and 2.8%, respectively, as they outlined plans to bring back furloughed employees this month.

Advancing issues outnumbered decliners by a 2.91-to-1 ratio on the NYSE and by a 2.08-to-1 ratio on the Nasdaq.

The S&P index recorded 31 new 52-week highs and no new lows, while the Nasdaq recorded 241 new highs and one new low.

Reporting by Devik Jain and Ambar Warrick in Bengaluru; Editing by Bernard Orr, Sriraj Kalluvila and Maju Samuel