|Wall Street bounces back from three-day slide
Maybe the sell-off was a little overdone.
That was the sentiment on Wall Street Tuesday as the stock market broke a three-day losing streak. The gain pushed the Standard & Poor's 500 index back into positive territory for the year, AP reports.
The rebound was driven partly by bargain-hunting.
“Longer-term investors should really use this as an opportunity to buy attractive areas that have sold off,'' said Kristina Hooper, US Investment Strategist at Allianz Global Investors. “For them, stocks are on sale.''
Stocks have had a volatile start to April. After closing at a record last Wednesday amid optimism about the improving outlook for the economy, stocks fell sharply on Friday as investors decided that some of the high-flying stocks in the technology and biotech sectors no longer justified their lofty valuations.
The S&P 500 gained 6.92 points, or 0.4 percent, to 1,851.96. The Dow Jones industrial average climbed 10.27 points, or 0.06 percent, to 16,256.14. The Nasdaq composite was up 33.23 points, or 0.8 percent, to 4,112.99.
On Tuesday, utilities rallied 1.5 percent. The sector has gained 10.5 percent this year, making it by far the best performing industry group in the S&P 500. Health care stocks are the next best performers, gaining 2.7 percent over the same period.
Technology stocks and consumer discretionary stocks, among the biggest decliners in the three-day sell-off, also logged gains on Tuesday.
Facebook was up by US$1.24, or 2.2 percent, to US$58.19. Google's class newly issued C shares gained by US$16.75, or 3.1 percent, to US$554.90.
Corporations start reporting first-quarter earnings this week, which should help stabilize the market, said Joe Quinlan, chief market strategist at US Trust. Quinlan attributed the stock market's recent wobble to investor's jitters ahead of corporate earnings.
Overall, corporate earnings are forecast to grow just 0.2 percent in the first quarter compared with the same period a year ago, according to S&P Capital IQ. That would be the weakest showing since the third quarter of 2009, when earnings contracted 1.7 percent.
Bond prices gained. The yield on the 10-year Treasury note fell to 2.68 percent from 2.70 percent on Monday.