The S&P 500 and Dow Jones Industrial Average fell for a second straight day on Wednesday as traders once again took profits out of names benefiting from the economy reopening and rotated into mega-cap tech stocks.
The S&P 500 traded 0.4% lower while the Dow slid 198 points, or 0.8%. The Nasdaq Composite, meanwhile, jumped 0.8% to a record high.
Shares of Amazon and Apple gained more than 1% each and hit all-time highs. Alphabet and Netflix rose 1.2% and 0.5%, respectively. Stocks that would benefit from the economy reopening — which have outperformed in recent weeks — fell broadly. American Airlines, United and JetBlue all dropped more than 7%. Wells Fargo slid 8.5% while Citigroup lost 4.8%. JPMorgan Chase traded 3.5% lower.
“A large shift is occurring as investors cycle out of value/cyclical stocks for a second day and pour money into growth,” said Adam Crisafulli of Vital Knowledge, in a note. “Keep in mind: investors never left growth/momentum. There was a brief flirtation w/cyclical-value over the last couple of weeks, but this was just rental positions held by tourists (growth is still home base for the majority of people in this market).”
Wednesday’s moves come as Texas reports consecutive record surges in coronavirus-related hospitalizations while Arizona’s hospitalization rate is also rising.
David Espinoza appeared unhappy when Arizona joined scores of states investigating Google last year. The Phoenix-based owner of a shoe-and-leather store wrote in a local newspaper he was “amazed and a little dumbfounded” by regulators’ campaign to “change how digital platforms operate.”
“The current system is working for small businesses, and as the old saying goes: if it ain’t broke, don’t fix it,” he wrote.
But Espinoza’s words, published in September by the Arizona Capitol Times, weren’t entirely his own. They were written on his behalf by an advocacy group that’s backed by Google and other tech behemoths, reflecting Silicon Valley’s stealthy new attempts to shape and weaponize public perception in response to heightened antitrust scrutiny.