Market Report

Tech-stock surge lifts Nasdaq, S&P 500 to new highs

FILE - This Monday, Nov. 23, 2020 file photo shows the New York Stock Exchange, right, in New York. Stocks are churning close to the breakeven line in the early going on Wall Street Thursday, Jan. 21, 2021,  as traders increase their focus on company earnings reports.  (AP Photo/Seth Wenig)
FILE - This Monday, Nov. 23, 2020 file photo shows the New York Stock Exchange, right, in New York. Stocks are churning close to the breakeven line in the early going on Wall Street Thursday, Jan. 21, 2021, as traders increase their focus on company earnings reports. (AP Photo/Seth Wenig)

U.S. stock indexes capped a day of choppy trading with a mixed finish Thursday, though solid gains by technology companies helped lift the S&P 500 and Nasdaq composite to more record highs.

The S&P 500 edged up less than 0.1%. Traders bid up shares in big technology stocks, including Apple, Amazon and Facebook. Those gains helped outweigh losses in energy stocks, banks and elsewhere. Stocks in smaller companies, which have led the way higher this year, gave up some of their recent gains.

The S&P 500 rose 1.22 points to 3,853.07, even as more stocks in the index closed lower. The Dow Jones Industrial Average slipped in the final minutes of trading, shedding 12.37 points, or less than 0.1%, to 31,176.01. The tech-heavy Nasdaq composite climbed 73.67 points, or 0.55%, to 13,530.92. The Russell 2000 index of smaller companies fell 19.20 points, or 0.9%, to 2,141.42.

Stocks have been mostly grinding higher this month amid optimism that covid-19 vaccines will lead to an economic recovery and expectations that Washington will deliver more stimulus for the economy. More recently, better-than-expected results from companies reporting quarterly results have helped keep U.S. stock indexes hovering near record highs or notching new ones.

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"Today is similar to yesterday in the sense that the broad indexes are flat or higher, but it's actually the tech names that have taken leadership again," said Ross Mayfield, investment strategy analyst at Baird.

Optimism about a strengthening economy later this year has been powerful enough to paper over worries about today's struggles. On Thursday, a report showed that 900,000 U.S. workers filed for unemployment benefits last week, as the worsening pandemic forces businesses to shut down and lay off employees. The number was less terrible than the previous week's 926,000, but it's still very high.

President Joe Biden has already proposed a $1.9 trillion plan, including $1,600 cash payments for most Americans and other assistance for the economy. Even though his Democratic party controls both houses of Congress, the proposal will likely face resistance given how slim the majority is.

Other reports on the economy were more encouraging on Thursday, including better-than-expected data on the homebuilding industry and manufacturing in the Philadelphia region.

More companies are also telling investors how badly their profits got hit during the last three months of 2020, when coronavirus counts and deaths were soaring. Wall Street entered this earnings reporting season with low expectations, forecasting a fourth straight quarter of profit declines. But most companies have been topping expectations.

"We are hearing more positive guidance from the [company] earnings calls," said Quincy Krosby, chief market strategist at Prudential Financial. "That's important because this is a market that's looking ahead."

Travelers rose 2.6% after the insurer reported a much stronger profit for the latest quarter than analysts expected.

Homebuilders rose after the encouraging report on housing starts, led by Beazer Homes USA's 5.1% gain. Paccar climbed 10.5% for the biggest gain in the S&P 500 after saying it will partner with autonomous-vehicle company Aurora to develop self-driving Peterbilt and Kenworth trucks.

On the losing end was United Airlines, which lost 5.7% after reporting a worse loss for the end of 2020 than analysts expected.

The yield on the 10-year Treasury rose to 1.10% from 1.07% late Wednesday.

Information for this article was contributed by Yuri Kageyama of The Associated Press.

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