Technology stocks, so pummeled yesterday, roared back today. The NASDAQ Composite gained 3.69% on the day. The NASDSQ 100 with its huge waiting to BIG TECH closed up 4.03%.
After yesterday, a day when the recent rotation into value, cyclical, and vaccine recovery stocks resulted in a sell off in technology shares, today, March 9, those shares showed only muted if any gains, and tech stocks saw huge pickups.
For example…
Shares of Marvell Technology Group (MRVL) gained 9.49% today after losing 3.47% yesterday. Shares of Apple (AAPL) were up 4.06% today after giving up 4.178% yesterday. Applied Materials (AMAT) gained 8.08% today after dropping6.50% yesterday. Tesla (TSLA) was ahead 19.64% today after falling 5.04% yesterday.
On the other hand, Disney (DIS), a big winner in yesterday’s rotation with a 6.33% gain, fell 3.67% today. Coca Cola (K) gained 1.73% yesterday and lost 1.51% today. Omnicom (OMC) picked up 3.70% yesterday and dropped 1.45% today.
Drivers for the turnaround and the gains, in my opinion included, a big drop in yields on the 10-year Treasury to 1.54% today, March 9, from 1.60% yesterday and a feeling among traders that the technology sector had plunged too far too fast and was due for a big bounce.
The chart for the Standard & Poor’s showed the index bouncing off support at the 50-day moving average at 3824 to a gain 1.42% at the close of 3875. I don’t see any comparable technical signs of support in the chart for the NASDAQ Composite, which closed at 13,073. That puts the index below support from the 50-day moving average at 13,337 and with a huge drop to find support at the 200-day moving average at 11,634.
In other words, the continuation of this technology bounce looks to depend mostly on the Treasury market and a rally there continuing to send yields on the 10-year Treasury lower.
Hard to figure out whether that’s a trend to count on in the Treasury market.
