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* Growth stocks on track to end six day streak
* Dow Jones hits all-time high, finances all-time high
* Tesla surges as Ark Invest buys an additional $ 171 million in shares
* Lowe’s does not meet downturn forecast for 2021
* Index increase: Dow 1.07%, S&P 0.89%, Nasdaq 0.68% (add comments, updates early afternoon)
February 24 (Reuters) – Major Wall Street indices gained ground on Wednesday as selling tech-related stocks eased and the rotation to cyclical stocks continued after the president’s comments from the Federal Reserve, Jerome Powell, allayed inflation fears.
Powell told lawmakers it might take more than three years to meet central bank inflation targets, another signal the Fed plans to look beyond any post-pandemic price hikes and leave interest rates unchanged for a long time.
The Nasdaq index recovered in the early afternoon after falling as low as 1.3%, while the Dow Jones Industrial Average hit a record high.
“There was a bit of focus on inflation and interest rates, but it’s going to be on the rearview mirror,” said David Yepez, senior equity analyst and portfolio manager at Exencial Wealth Advisors.
Value-oriented stocks recently rebounded slightly, with the S&P 500 Value index rising for a fourth consecutive day.
The financial sector of the S&P 500 jumped 1.9% to an all-time high, while other cyclicals, notably industrials, energy and materials, also rose.
The S&P 500 Growth Index, home to most of the tech-related high-tech stocks, has come under pressure in recent days due to valuation issues, high Treasury yields and a shift in investment towards more economically sensitive market segments.
Microsoft Corp, Amazon.com Inc, Facebook, and Apple Inc fell 0.3% to 1%, while Netflix Inc and Alphabet Inc reversed earlier declines.
“What’s going on is just a small change in growth towards value, but today things are returning to normal a little and you have a little more movement towards growth,” Yepez said.
Growth-oriented stocks are particularly sensitive to rising yields because their value relies heavily on future earnings, which are discounted more deeply when bond yields rise.
Tesla Inc gained 4.8% after star investor Cathie Wood’s Ark Invest fund bought an additional $ 171 million in company stock following a sharp drop in shares in the electric car maker .
At 12:45 p.m. ET, the Dow Jones Index was up 337.69 points, or 1.07%, to 31,875.04, the S&P 500 was up 34.36 points, or 0.89%, to 3,915.73 and the Nasdaq was up 92.14 points, or 0.68%, to 13,557.33.
All three major indices were tracking solid monthly gains, with the Dow and S&P 500 set for their best month since November.
Lowe’s Cos Inc slipped 3.83% as it stuck to its 2021 outlook of a $ 4 billion to $ 8 billion drop in revenue, even after reporting explosive fourth-quarter results.
Uber Technologies Inc fell 2.21% after a media report that Chinese cycling giant Didi Chuxing Technology Co Ltd plans to enter Western Europe.
Rising issues outnumbered declines by a 2.17-to-1 ratio on the NYSE and a 3.12-to-1 ratio on the Nasdaq.
The S&P Index recorded 84 new 52-week highs and no new lows, while the Nasdaq recorded 235 new highs and four new lows. (Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Anil D’Silva and Shounak Dasgupta)
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