The S&P 500 erased previous gains and ended Friday near the flatline as the tech sector came under renewed pressure due to a further decline in Bitcoin price.
The broad equity benchmark fell less than 0.1% to 4,155.86 after rising 0.7% earlier in the day. The Dow Jones Industrial Average rose 123.69 points, or 0.4%, to 34,207.84 thanks to a rise in Boeing stocks. The Nasdaq Composite fell 0.5% to 13,470.99.
During the week, the S&P 500 fell 0.4% to see its first weekly losses since February. The blue-chip Dow fell 0.5% this week while the Nasdaq Composite rose 0.3% this week, breaking a four-week losing streak.
Bitcoin, which rocked the markets with a 30% collapse earlier in the week, fell again on Friday after Chinese Deputy Prime Minister Liu warned of behavior in mining and trading Bitcoin. Stricter regulation is required to protect the financial system. The price was last cut 10% to around $ 36,200. Crypto-linked stocks, including Coinbase and MicroStrategy, turned red on the headline, ending the day 3.9% and 4.7% lower, respectively. Tesla fell 1%.
Boeing was up 3.2% after Reuters reported the aircraft maker was talking about increasing 737 MAX performance to up to 42 jets per month by the end of 2022.
Improving sentiment on Friday was a measure of US manufacturing activity, which hit a record high this month. The IHS Markit Flash US manufacturing purchasing managers’ index rose from 60.5 in April to an all-time high of 61.5 in May. Economists polled by Dow Jones had expected the index to remain stable.
“The first major economic data point for May was very strong,” said Adam Crisafulli, founder of Vital Knowledge, in a note. “We already know the Fed is considering a rejuvenation and this release could make them think a little harder about it, but stocks should be fine as long as the Fed doesn’t signal a rejuvenation before November.”
Nvidia’s shares rose 2.6% after the chip giant announced a 4-for-1 stock split. Shares rose even though the split didn’t add any actual value to the stock.
Ford, which said it had 20,000 reservations for its new F-150 electric pickup, gained 6.7%. Home Depot shares rose 0.7% after the retailer announced a new $ 20 billion share buyback program.
In yet another sign of market confidence, the new Oatly IPO, which rose 18% on Thursday’s Nasdaq debut, rose more than 11% on Friday.
Friday’s moves followed a comeback day on Wall Street, with the Dow gaining 186 points and the S&P 500 and Nasdaq Composite ending the day 1.06% and 1.77% higher, respectively. Investors welcomed a new pandemic low in unemployment claims on Thursday.
“Thursday’s improvement in jobless claims confirms our view that April’s disappointing job report was more of a slip than a sign of slowdown, and we expect the labor market to see significant improvement in the coming months,” he said Scott Ruesterholz, Portfolio Manager at Insight Investment.