By Yasin Ebrahim
Fintech Zoom – The Dow fell Monday, paced by declines in consumer discretionary and technology as investors reined in their bullish bets on stocks ahead of a busy week, with big tech set to report earnings this week.
The fell 0.36%, or 123 points, but remained close to its record of 34,256.75. The fell 0.53%, and the was down 0.98%.
Tech stocks stalled after their recent rally, as investors to pause on big tech ahead of earnings from FAANG due later this week.
Consumer discretionary, meanwhile, was led lower by a fall in casino stocks despite expectations for a strong rebound for the sector as a faster pace of vaccine rollouts boosts efforts to reopen the economy.
Caesars Entertainment Corporation (NASDAQ:) and Penn National Gaming (NASDAQ:) were among the biggest losers, with the latter down more than 6%.
“We think pent-up demand and a return of older gamblers should drive upside in coming months but less promo and non-gaming could still keep reported net revenue below pre-COVID levels,” Bank of America (NYSE🙂 said last week.
Tesla (NASDAQ:) also held the sector back after falling 3% following reports of a crash of a Tesla vehicle in Texas that left two people dead, with widespread speculation over whether the electric vehicle’s “Autopilot” system was engaged.
Energy recovered some losses as oil prices moved off lows, though remained pressured by concerns rising global coronavirus infections could delay the return of international travel and hamper energy demand at a time of substantial supply.
In consumer staples, Coca-Cola (NYSE🙂 inched higher following better-than-expected first-quarter results. The company also unveiled plans to launch an IPO for its Coca-Cola Beverages business in Africa.
In other news, GameStop (NYSE🙂 chief executive George Sherman is set to step down on July 31, or earlier if a successor is found before then. The move adds to growing optimism over the company’s digital transition, sending its share price up more than 6%.
Despite the broader market slump, Wall Street continues to bet on cyclical stocks in what is the second-year of the risk-on cycle that started in March 2020.
“We are currently in the second year of a risk-on cycle that started in March 2020. After a substantial recovery in the market during year one, we expect the cyclical risk-on trend to continue — albeit with a lower return,” Wells Fargo (NYSE🙂 said.
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