Dow falls 120 points to start the week, Nasdaq rises as Big Tech gains

Dow falls 120 points to start the week, Nasdaq rises as Big Tech gains

Traders on the floor of the New York Stock Exchange.

Source: NYSE

The Dow Jones Industrial average declined slightly from a record as investors waited for second-quarter earnings season to kick off this week. Tech shares bucked the trend, lifting the Nasdaq Composite.

The Dow shed 120 points, or 0.4%. The S&P 500 was flat. The Nasdaq Composite gained 0.4%, just shy of another record.

Apple, Amazon, Alphabet, Microsoft and Facebook were in the green. Shares of Tesla also gained.

The 10-year Treasury yield dipped slightly to around 1.34%, continuing its losses from last week. Bank shares, despite expectations for strong earnings reports this week, fell as yields declined. Bank of America and JPMorgan were bother lower.

Other shares linked to the economic comeback from the pandemic were slightly weaker with Boeing and Carnival Corp. lower.

The three major indexes closed at record highs on Friday after a sell-off Thursday as investors worried about a potential slowdown in U.S. economic growth.

The major averages’ record highs come ahead of the start of quarterly earnings reports. S&P 500 companies’ profits are expected to be up 65% from the same quarter a year ago, according to Refinitiv, bouncing back from the worst of the pandemic. The expected surge in profits would be the strongest earnings growth since the fourth quarter of 2009, as stocks recovered from the financial crisis.

“Continued earnings momentum should refuel investors’ confidence in the recovery amid slowdown concerns and drive a rotation back into Value,” Bank of America’s Savita Subramanian said in a note Sunday.

JPMorgan ChaseGoldman Sachs and PepsiCo kick off earnings season with results due out before the bell on Tuesday. Bank of America, Citigroup, Wells Fargo, Delta Air Lines and BlackRock report on Wednesday, and Morgan StanleyTruist and UnitedHealth post results on Thursday.

Investors also anticipate important data to be released this week, including key readings on inflation on Tuesday and Wednesday, and June retail sales on Friday.

Friday’s rally brought the averages into the green for the week; the Dow added 0.24% week-to-date, while the S&P 500 and Nasdaq each rose about 0.4% in the same period.

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