Traders work on the floor of the New York Stock Exchange (NYSE), Aug. 3, 2021.
Michael Nagle | Bloomberg | Getty Images
U.S. stocks rose slightly on Wednesday after the S&P 500 notched a seven-month win streak in August.
The broad equity benchmark climbed 0.2%. The tech-heavy Nasdaq Composite advanced 0.5% to hit a new intraday record high, thanks to a 1.7% jump in Apple shares to an all-time high. The Dow Jones Industrial Average was little changed.
The major averages all finished higher for the month of August. The S&P 500 rose 2.9% for the month, posting its best winning streak since 2017. The Nasdaq Composite gained about 4% for its third positive month and while the Dow lagged, it still added 1.2%.
Investors digested a disappointing employment report. U.S. companies created far fewer jobs than expected in August with private payrolls rising just 374,000, according to payroll services firm ADP. That is well below the Dow Jones estimate of 600,000.
The report is a precursor to the official August U.S. non-farm payrolls data, which will be released Friday. Economists polled by Dow Jones expect 720,000 jobs were created in August and the unemployment rate fell to 5.2%.
Cyclical stocks tied to the reopening of the economy were gaining in premarket trading Wednesday. Casino shares were higher, led by Las Vegas Sands. Exxon Mobil led a gain in energy shares.
Bank shares were rising led by Citigroup and Bank of America up by about 1% apiece in the premarket. The financials sector led the market higher in August with a gain of 5%.
“We maintain a risk-on stance and position in stocks that should benefit from strong economic growth and reopening,” wrote UBS wealth strategists in a Wednesday note.
Solar stock Sunrun gained 2% in premarket trading after JPMorgan predicted a comeback that would take the shares 90% higher.
Zoom Video shares rebounded in premarket trading following a 16% plunge Tuesday after Cathie Wood revealed she bought nearly 200,000 shares on the dip.
Despite internal rotations from reopening stocks to tech and back again, the S&P 500 has had a pretty smooth ride so far in 2021, up more than 20% without even a 5% pullback. The benchmark has closed above its 200-day moving average, a measure of the long-term trend, for 296 days in a row.
So some strategists are on the lookout for a correction in September given that stocks haven’t had a significant one since last October, combined with the highly anticipated meeting of the Federal Reserve Bank in September and the continued worry about the delta Covid variant.
“Although this bull market has laughed at nearly all the worry signs in 2021, let’s not forget that September is historically the worst month of the year for stocks,” said LPL Financial Chief Market Strategist Ryan Detrick. “Even last year, in the face of a huge rally off the March 2020 lows, we saw a nearly 10% correction in the middle of September.”
He added any weakness could be short-term and contained in the 5% to 8% range.
“This bull market is alive and well and we would view any potential weakness as an opportunity,” he said.