Nasdaq rises as major tech stocks Apple and Microsoft hit record highs, S&P 500 falls slightly

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Nasdaq rises as major tech stocks Apple and Microsoft hit record highs, S&P 500 falls slightly

The Nasdaq Composite rose on Tuesday, recovering from a decline earlier in the session, as shares of major tech companies such as Microsoft and Apple outperformed.

The tech-heavy index gained 0.15% and was on pace to notch a record closing high. The Nasdaq also hit an intraday all-time high. Microsoft shares gained 1.6% to hit an all-time high. Apple also reached record levels, climbing 1.2%. Facebook and Netflix gained 2.9% and 1%, respectively, to trade at all-time highs as well.

“It’s the same group of stocks that lead us higher almost on a daily basis,” said Peter Cardillo, chief market economist at Spartan Capital Securities. “The rest of the market follows, but it’s certainly nowhere near as strong as that group.”

Positive news on the coronavirus front also gave the Nasdaq a boost. The U.S. government awarded drugmaker Novavax a $1.6 billion contract to develop a coronavirus vaccine, the biggest amount yet granted under the White House’s “Operation Warp Speed.” Novavax shares were up 37%.

But the broader market struggled. The S&P 500 traded 0.2% lower. The Dow Jones Industrial Average fell 194 points, or 0.7%.

Market sentiment was kept in check as stocks tied to the economy reopening from the coronavirus shutdowns were lower. Norwegian Cruise Line and Carnival Corp were lower by more than 2% each. American Airlines and United Airlines fell 5.2% and 5.7%, respectively.

“With the increasing virus cases, people are playing the stay-at-home stocks,” said Brent Schutte, chief investment strategist for Northwestern Mutual Wealth Management. “One thing I will say is the probability of returning to a nationwide lockdown is incredibly slim. So I wouldn’t be surprised to see more of a rolling, back-and-forth market rather than one that goes straight up like we’ve seen the past few months.”

More than 2.93 million coronavirus cases have been confirmed in the U.S. along with at least 130,306 deaths, according to Johns Hopkins University. Over the weekend, more than 20 states reported a hospitalization growth rate of at least 5%

Atlanta Federal Reserve President Raphael Bostic also told The Financial Times the U.S. economic recovery will be “bumpier” as coronavirus cases continue to rise.

Still, Wall Street was coming off strong day that saw the Dow jump more than 450 points.

“While we expect continued volatility, we think there are grounds for optimism that economies and markets can weather the recent acceleration in infections,” Mark Haefele, chief investment officer at UBS, said in a note. “There are signs that healthcare systems are coping better with COVID-19, reducing the need for restrictions on freedom of movement. Economic data continues to point to resilience.”