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By Connor
Smith | Friday, March 25 The
Rebound Continues. U.S. stocks capped off another solid week today. The Dow
Jones Industrial Average rose 0.4% on the day, enough for a
second-straight week of positive gains. The S&P 500
rose 0.5%, finishing up 1.8% for the week. "Geopolitical risks remain very
elevated and the rally in equities over the past two weeks is
impressive," writes Oanda analyst Edward Moya.
"The U.S. economy is still in good shape, but buying every stock market
dip probably won't be the attitude for most traders going forward given how
hawkish the Fed has turned." The Nasdaq Composite had both the
worst Friday and the best week of the major indexes. It fell 0.2% on the day,
but still managed a weekly gain of 2%. The tech-heavy index has jumped more
than 10% in the past two weeks, its best such stretch since the two weeks
ending on April 17, 2020. Today, though, technology stocks were weaker
as the yield on 10-year Treasury rose to 2.48%. Higher long-term yields are
generally bad news for high-growth tech stocks because they lower the value
of future profits. That shift in investor sentiment has hurt
shares of high-growth firms like DoorDash and Shopify,
which are down 56% and 60%, respectively, from their November peaks. Barron's
Eric Savitz reports that those moves are now being
felt in the private market, as well. This week, grocery-delivery firm Instacart slashed
its estimated valuation by 40% to $24 billion. Eric writes: As a private company, Instacart has no
requirement to provide an estimated valuation. And since the shift wasn’t
connected with a funding round, the new number is still basically a guess.
But it provides a stark reminder of the close ties between public- and
private-market valuation—and it suggests that many venture-capital funds are
likely sitting on considerable losses on venture investments in Instacart and
other companies made when the equity market was peaking in 2021. Big tech managed to avoid today's tech
selloff. Shares of Apple, Alphabet,
Amazon, and Meta Platforms all closed
higher on the day. (Apple was up for a ninth consecutive day.) That's despite
the European Union's legislative bodies announcing a provisional political
agreement on its
Digital Markets Act, which targets large online platforms. One key
change could force interoperability between messaging apps like Meta's
WhatsApp and Apple's iMessage and smaller competitors. Based on today's stock
moves, U.S. investors don't seem too concerned. Watch our
weekly TV show on Fox Business Saturdays at 10 a.m. or 11:30 a.m. ET; or
Sundays at 10 a.m. or 11:30 a.m. ET. This week, an interview with Jenny
Johnson, CEO of Franklin
Resources. |
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DJIA: +0.44% to 34,861.24 The Hot Stock: Coterra
Energy +7.0% Best Sector: Energy +2.2% |
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