U.S. stocks were higher in late morning trading on Monday, with the S&P 500 and Dow Jones Industrial Average hitting yet another record high, as technology stocks rebounded after recent losses.
The S&P technology sector .SPLRCT is coming off its second straight weekly decline, triggered by fears of stretched valuations and investors moving money to other sectors. Tech stocks have led the S&P 500’s rally this year.
Leading the recovery, Apple (AAPL.O) rose 2.6 percent, providing the biggest boost to the three major sectors. Microsoft (MSFT.O) and Alphabet (GOOGL.O) were also up.
The tech sector’s 1.37 percent rise led the gainers on the S&P 500, putting it on track for its biggest one-day percentage rise since March.
“Some of it is folks taking a second-look at names that may have been unduly punished in the rotation out of tech that started about 10 days ago,” said David Lefkowitz, senior equity strategist at UBS Wealth Management Americas in New York.
“There has been no change in the fundamentals for the tech sector. Earnings growth, earnings revisions and forward looking indicators remain healthy.”
The Nasdaq Composite .IXIC was up 72.12 points, or 1.17 percent, at 6,223.88.
Consumer staples stocks, which were battered on Friday after Amazon.com’s (AMZN.O) $13.7 billion deal to buy upscale grocer Whole Foods WFM.N, added to their losses.
The deal by Amazon, a proven retail disruptor, marked a major step by the internet retailer into the brick-and-mortar retail sector. Amazon rose as much as 2.9 percent to an all-time high of $1017.
Wal-Mart (WMT.N), Target (TGT.N) and Costco (COST.O) reversed premarket gains to trade lower.
New York Fed President William Dudley, a close ally of Fed Chair Janet Yellen, said U.S. inflation was a bit low but should rise alongside wages as the labor market continues to improve, allowing the Federal Reserve to continue gradually tightening U.S. monetary policy.
Yellen’s confidence as her team raised interest rates for the third time in six months last week surprised investors who had expected more caution about the economy following a set of weak U.S. economic data.
Advancing issues outnumbered decliners on the NYSE by 1,803 to 964. On the Nasdaq, 1,793 issues rose and 906 fell.
The S&P 500 index showed 49 new 52-week highs and 10 new lows, while the Nasdaq recorded 99 new highs and 87 new lows.
(Reporting by Tanya Agrawal; Additional reporting by Chuck Mikolajczak; Editing by Saumyadeb Chakrabarty)