S&P 500 pares some Apple-led gains as rates inch higher ahead of Powell testimony

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S&P 500 pares some Apple-led gains as rates inch higher ahead of Powell testimony
Credit: © Reuters.

By Yasin Ebrahim

Investing.com -- The S&P 500 pared some gains Monday, as U.S. Treasury yields inched higher ahead of the testimony from Federal Reserve chairman Jerome Powell , but an Apple-led climb in tech kept stocks in the green.

The S&P 500 gained 0.2%, the Dow Jones Industrial Average added 0.1%, or 21 points, and the Nasdaq Composite was up 0.2%.

Growth stocks such as tech were forced to retreat from session highs as U.S. Treasury yields turned positive ahead of Powell’s semi-annual testimony on Capitol Hill that could offer clues on monetary policy.

“The testimony is key because if he [Powell] wishes to influence market pricing for the decisions that will come out of the March 21-22 FOMC meeting then this is his last and best chance to do so,” Scotiabank said in a note.

The testimony from Powell comes just days ahead of the March nonfarm payrolls due Friday and inflation report due next week, both of which are expected to play an important role in the Fed’s thinking on monetary policy measures.

Apple (NASDAQ: AAPL ) jumped more than 2% after Goldman Sachs issued a Buy rating on the stock after six years on the sidelines, citing strength in the tech giant’s services business.  

Other big tech stocks also attracted buying pressure, with Alphabet (NASDAQ: GOOGL ), Amazon.com Inc (NASDAQ: AMZN ) and Microsoft Corporation (NASDAQ: MSFT ) up 1%.

Tesla (NASDAQ: TSLA ), meanwhile, fell more than 1% after the electric carmaker cut prices in the U.S. for the second time this year to boost demand. Tesla was also dealt a blow by Morgan Stanley removing the EV maker as a ‘top pick’ in favor of Ferrari.

Morgan Stanley lifted its price target on Ferrari NV (NYSE: RACE ) to $310 a share from $280 previously on optimism that the race car company has “levers to pull for both growth or downside protection.”

In other news, sentiment on homebuilders was soured after JPMorgan doubled downgraded KB Home (NYSE: KBH ) to Neutral, and downgraded DR Horton Inc (NYSE: DHI ) to Neutral, citing valuation concerns.

Boeing (NYSE: BA ), a major Dow component, kept the broader market's gains in check amid reports a software issue threatens to delay deliveries of its 737 MAX and 787 jets by up to a year.

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