Wall Street also rises in August
The major Wall Street indices closed slightly lower on Tuesday, but a weak end of the month failed to dampen the strong performance in August, in what is traditionally seen as a quiet period for equities.
After hitting all-time highs in the second half of the month, including four record closes in five sessions for the S&P 500, all three benchmarks were weighed down by tech stocks in the final session of August.
For the S&P, it was the seventh month of gains in a row, reflecting investor confidence in US equities, as the Federal Reserve continued to do so in terms of easing its massive stimulus program.
“After all the monetary and fiscal interventions, the question is where are we going? Will the S&P go to 5,000 (points), and how will it get there?” Said Eric Metz, CEO of SpringRock Advisors.
While strong recovery in economic growth and corporate earnings boosted US stocks in August, investors are concerned about rising coronavirus cases and the Federal Reserve’s monetary policy trajectory.
A Reuters poll conducted last week showed that strategists believe the S&P 500 is likely to end 2021 not far from its current level.
Tech stocks have continued to spark investor interest in recent days, given the benefits low interest rates have on their future earnings, although the industry index was one of the worst performers on Tuesday.
Shares of Apple fell after hitting an all-time high in the previous session, while those of Zoom Video Communications plunged on notice of a faster-than-expected decline in demand for its video conferencing service after the rise of the pandemic.
With information from Reuters.