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Nasdaq hits record high as Big Tech roars back

By Noel Randewich and Devik Jain

(Reuters) – The Nasdaq hit an intra-day record high on Tuesday, lifted by Amazon, Microsoft and other top-shelf growth companies, while investors awaited remarks about the economic recovery from Federal Reserve Chair Jerome Powell.

Amazon.com Inc rose 1.5% and was on track for its first record-high close since September, while Microsoft climbed 0.8% to an intra-day record.

Amazon saw over $5.6 billion in total online sales in the United States on the first day of its Prime promotional event, according to Adobe Digital Economy Index.

In prepared remarks released late on Monday, Powell reiterated that recent high inflation was expected to prove temporary. The Fed chief was due to speak before Congress at 2 p.m. ET (1800 GMT).

So-called value stocks, expected to benefit from the economic recovery, have outperformed in 2021, while growth stocks, including major tech names like Apple and Nvidia, have rallied since the Fed last week took a stance on future rate hikes viewed by many as more aggressive than expected.

The S&P growth index has added over 1% since before the Fed last Wednesday projected an accelerated timetable for interest rate increases, compared to a nearly 2% drop in the value index.

“The market was caught off guard regarding the Fed’s hawkish commentary, and that’s 100% of what is happening,” said Andrew Mies, chief investment officer of 6 Meridian. “All the smart people were surprised about how hawkish the Fed was, and now they are adjusting their portfolios.”

Nine of the 11 major S&P sector indexes rose, with consumer discretionary and tech up most.

(Graphic: S&P 500 sectors YTD, https://fingfx.thomsonreuters.com/gfx/mkt/oakvebdxapr/Pasted%20image%201624375167038.png)

At mid-day, the Dow Jones Industrial Average was up 0.09% at 33,909.06 points, while the S&P 500 gained 0.36% to 4,239.88.

The Nasdaq Composite added 0.47% to 14,208.37.

Cryptocurrency exchange Coinbase Global fell 0.7% as bitcoin slipped below $30,000 for the first time since January, briefly wiping out gains for the year.

GameStop jumped 5% after the videogame retailer said it raised over $1 billion in its latest share offering, cashing in further on this year’s Reddit-driven surge in its stock price.

Sanderson Farms jumped 9.9% to a record high after J.P. Morgan raised its price target on the stock after a source told Reuters that the chicken producer was exploring a sale.

Moderna Inc rose 6.3% after the European Union decided to take up an option under a supply contract with the drugmaker that allows the bloc to order 150 million additional COVID-19 vaccines.

Splunk Inc surged 8.8% after the data analytics software maker said private equity firm Silver Lake invested $1 billion in the company’s convertible senior notes.

Declining issues outnumbered advancing ones on the NYSE by a 1.09-to-1 ratio; on Nasdaq, a 1.51-to-1 ratio favored decliners.

The S&P 500 posted 25 new 52-week highs and 1 new low; the Nasdaq Composite recorded 56 new highs and 53 new lows.

(Additional reporting by Devik Jain, Sujata Rao-Coverley and Medha Singh in Bengaluru; Editing by Maju Samuel and Sonya Hepinstall)

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