Stock Market Today: Tech Stocks Lag as Treasury Yields Keep Rising | Kiplinger

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Stock Market Today

The 10-year Treasury yield rose for a sixth straight day to hit a new three-year high.Tech stocks underperformed in today’s session, much as they’ve done over the last few months.

The technology sector gave back 1.4% as the 10-year Treasury yield climbed 5.2 basis points (a basis point is one-one hundredth of a percentage point) to 2.71% – a level not seen since March 2019. The longer-dated bond yield is up six days in a row amid expectations the Federal Reserve will undergo an aggressive monetary policy tightening campaign with 50-basis-point rate hikes and the sale of $95 billion in assets each month. 

Energy, meanwhile, was the best-performing sector, rising 2.8% as U.S. crude futures jumped 2.3% to $98.26 per barrel. Financials (+1.0%) and material stocks (+0.6%) were other pockets of strength in today’s trading.

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At the close, the Nasdaq Composite was down 1.3% at 13,711, with chip stocks Nvidia (NVDA, -4.5%) and Marvell Technology (MRVL, -3.8%) among the day’s biggest decliners. The S&P 500 Index (-0.3% to 4,488) also ended lower, while the Dow Jones Industrial Average (+0.4% to 34,721) finished the day in the green.

For the week, the Nasdaq shed 3.9%, the S&P 500 gave back 1.3% and the Dow slipped 0.3%.

YCharts

Other news in the stock market today:

The small-cap Russell 2000 shed 0.8% to 1,994.Gold futures rose 0.4% to finish at $1,945.60 an ounce.Bitcoin fell 1.5% to $42,777. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m.)EPAM Systems (EPAM) was one of the biggest gainers today, adding 9.9% after the software development company said it is ending operations in Russia. Stifel analyst David Grossman maintained a Buy rating on the tech stock in the wake of the news. “We interpret today’s announcement as a positive as it removes the most visible overhang from a customer standpoint and accelerates EPAM’s initiative to geographically diversify its labor base,” Grossman writes in a note.HP (HPQ, -7.1%) was downgraded to Neutral (Hold) from Buy at UBS Global Research. This came on the heels of yesterday’s announcement that Warren Buffet bought HPQ stock and occurred amid a “confluence of factors including incremental signs of softness in low-end Consumer PCs following recent checks over the past month along with the  likelihood of a slower buyback next year following the expected close of the Plantronics deal in late calendar-year 2022,” writes UBS analyst David Vogt.Stock Selection is Becoming Increasingly ImportantNext week, we’ll start to get a look at the latest inflation figures with Tuesday’s release of the consumer price index. Plus, the start of earnings season will offer an initial gauge of how corporate America fared during a period of scorching prices.

This will be especially important to investors looking to target firms that have been able to withstand red-hot inflation thanks to rock-solid balance sheets.

A focus on quality stocks will give them a better shot at building resilience in their portfolios, according to Tony DeSpirito, CIO of BlackRock’s U.S. Fundamental Active Equities. He says that stock selection is becoming more important as investors “must discern which companies are most impacted by rising costs, and which have the pricing power to pass those higher costs through to consumers and maintain their profit margins.”

But stock picking isn’t for everyone, and some investors may want to leave making these judgments to the pros. Those looking for a human touch could check out the Kip 25 – Kiplinger’s list of our favorite low-fee mutual funds. Another great place to look is the small but expanding group of actively managed exchange-traded funds (ETFs). This list of equity and fixed-income ETFs aligns with a variety of risk tolerances and investing horizons, and all are run by seasoned stock pickers. 

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