Key Indexes Post Gains
The Dow Jones Industrial Average rose over 200 points on Tuesday, climbing 0.6% to 33,704 at market close. The S&P 500 gained 0.7% to 3,919 while the Nasdaq Composite added 1% to 10,742 (CNN Business). The market shrugged off a decline in Boeing shares to rally on the back of tech strength.
Img Credit: – CNBC
Boeing Stock Slides After Deliveries Fall Short
The airplane maker Boeing posted a 6.5% drop in deliveries of new jets in 2022, falling short of its own target according to company data. Boeing delivered a total of 480 jets for the year compared to its forecast of 500 deliveries. The company has struggled with production issues surrounding structural defects in its 787 model. Boeing stock fell 2.5% on the news, making it one of the worst Dow performers.
Tech Sector Provides Tailwind
While Boeing weighed on the price-weighted Dow, strength in the technology sector helped offset those losses. Tech giants like Apple, Microsoft, Cisco and Intel climbed over 1% each. The technology-concentrated Nasdaq index substantially outperformed the Dow and S&P 500 on this tech boost. Investors showed renewed optimism in beaten-down growth stocks to start 2023.
Upbeat Outlook on Rates Boosts Risk Appetite
An encouraging forecast from the IMF on inflation and interest rates also promoted more risk-taking in equities. The IMF said it believes the Federal Reserve can achieve a “soft landing” in engineering an economic slowdown to conquer high inflation. This outlook led investors to scoop up equities, especially slower-growth companies and megacap tech names.
Market Volatility Expected to Remain
However, analysts warn investors to brace for continued ups and downs in the stock market until concrete evidence arises that the Fed has inflation fully under control. Ongoing concerns around higher rates, the war in Ukraine, and China’s shaky recovery all spell more turbulence even amid the recent rally. Traders should utilize defensive strategies to weather this volatility.
