Apple, Netflix, Facebook rise after steep two-day decline
U.S. stocks climbed on Tuesday, with the Dow hitting an intraday record, as technology shares rebounded after a two-day decline. Investors looked ahead to the start of a closely watched Federal Reserve meeting that could offer clues about the central bank's monetary-policy stance.
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The Dow Jones Industrial Average rose 82 points, or 0.4%, to 21,318, briefly climbing to an all-time intraday high of 21,326.58. The S&P 500 added 8 points, or 0.4%, to 2,438. The Nasdaq Composite Index rose 41 points, or 0.7%, to 6,216.
Tech shares fell sharply on Friday and Monday, weighing on broader indexes, particularly in the Nasdaq, which has a higher concentration of tech names. Despite that, major indexes have been in a pronounced uptrend of late; the S&P is less than 0.5% away from its own record, while the Nasdaq is about 2% below its own all-time high.
Read:Don't panic--this shows tech stocks' slide may well be a buying opportunity (http://www.marketwatch.com/story/whats-next-for-technology-stocks-bloodbath-or-bliss-2017-06-12)
And see: What sparked the Nasdaq's worst two-session, tech-fueled rout in 9 months (http://www.marketwatch.com/story/what-sparked-the-nasdaqs-worst-two-session-rout-in-9-months-2017-06-12)
The tech selloff didn't spread to other sectors in a notable way. Instead, it was countered by a move into the energy and financial sectors, which Chris Weston, chief market strategist at IG, said could potentially offer better returns.
Weston doesn't really think the 10% decline "that many had been talking about on Friday," will come to pass, he said in a note to clients.
Fed meeting kicks off: Investors are turning their attention to the two-day Federal Open Market Committee meeting that wraps up Wednesday with a news conference with Fed Chairwoman Janet Yellen.
Market observers are nearly unanimous in the view that the fed-funds rate will be lifted, with a nearly 100% chance of an interest-rate increase, according to the CME Group (http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html?redirect=/trading/interest-rates/fed-funds.html).
"We are seeing a little of a move back up mainly due to expectations from Fed meeting," said Chris Gaffney, president at EverBank World Markets.
With an interest rate hike priced in, investors are comfortable with the idea that the Fed will remain cautious to ensure that tighter monetary policy does not hinder growth, he said.
Investors will scrutinize the Fed's words to glean the pace of rate increases in the coming months.
The Fed "has been confronted recently with softer inflation data and only scattered evidence of an expected reacceleration of activity," David Joy, chief market strategist at Ameriprise Financial wrote in a note. "While few expect the Fed to refrain from acting this time, what it must say about upcoming meetings and the possible timing of the start of unwinding its balance sheet will be scrutinized."
Check out: Here's what the Fed will signal when it hikes interest rates (http://www.marketwatch.com/story/heres-what-the-fed-will-signal-when-it-hikes-interest-rates-2017-06-12)
Also of interest for investors will be Attorney General Jeff Session, who will testify before the Senate Intelligence Committee (http://www.marketwatch.com/story/sessions-to-testify-at-open-senate-hearing-on-tuesday-committee-says-2017-06-12) later Tuesday and is expected to be questioned as part of the panel's investigation into Russian efforts to interfere in last year's election. The Justice Department's Russia probe is seen as a potential headwind for the market, as any protracted controversy involving President Donald Trump could reduce the odds that his economic agenda gets passed, which analysts say is necessary to justify current valuations.
Any "shocking" revelation from the testimony that could hamper the administration from introducing further policy change could send stocks back into negative, said Gaffney.
Economic data: The National Federation of Independent Business reported small-business sentiment was steady in May (http://www.marketwatch.com/story/small-business-sentiment-holds-steady-in-may-2017-06-13). Separately, the producer-price index (http://www.marketwatch.com/story/us-wholesale-inflation-eases-in-may-but-still-elevated-ppi-shows-2017-06-13) was flat last month following a sharp 0.5% increase in April, as had been expected.
Stock movers: Shares of Facebook Inc. (FB) added 1.7%, Google parent Alphabet Inc. (GOOGL) was up 0.9%, and Amazon.com Inc. (AMZN) was up 1.3%.
Eli Lilly & Co. (LLY) dipped 0.5%, erasing a premarket gain that came after the company said its pain drug with Pfizer Inc. (PFE) had received fast track designation (http://www.marketwatch.com/story/eli-lilly-stock-rises-15-after-pain-drug-gets-fast-track-designation-from-fda-2017-06-13) from the Food and Drug Administration.
Cheesecake Factory Inc. (CAKE) shares slumped 9.8% after the company cut its second-quarter outlook (http://www.marketwatch.com/story/cheesecake-factory-shares-sink-after-downward-revision-of-guidance-2017-06-13).
Other markets: European stocks were firmer across the board (http://www.marketwatch.com/story/european-stocks-rise-as-techs-move-toward-recouping-losses-2017-06-13), lifted by gains in tech stocks. Asian markets shook off Wall Street's woes and mostly rose (http://www.marketwatch.com/story/asian-markets-shake-off-wall-streets-woes-post-gains-2017-06-12).
The dollar was softer and fell against the British pound , which rose after a bigger-than-expected gain in U.K. inflation. Oil prices climbed (http://www.marketwatch.com/story/oil-prices-higher-again-but-supply-glut-hangs-over-market-2017-06-13), and gold prices pulled back.
--Barbara Kollmeyer contributed to this report.
(END) Dow Jones Newswires
June 13, 2017 13:21 ET (17:21 GMT)