* The bank, energy stocks gain in the perspective of higher incentives
* Utilities, home builders slip as Treasury yields increase
* Cryptographic stocks grow as bitcoin briefly exceeds $ 50,000 (Market closing updates)
NEW YORK, Feb 16 (Reuters) – The Dow Jones industrial average hit a record high on Tuesday as cyclical sectors gained more fiscal aid to lift the US economy out of a coronavirus crisis.
However, the Nasdaq declined as technology stocks declined, while concerns about rising interest rates kept the S&P 500 benchmark slightly changed.
Sectors prepared to benefit most from a reopening economy, including energy and finance, had the highest percentage gains. President Joe Biden has launched a $ 1.9 trillion pandemic emergency bill and is pressuring Congress to pass it in the coming weeks to receive $ 1,400 in stimulus checks for Americans and increase unemployment payments.
The S&P 500 Banking Index rose as yields on the 10-year US Treasury peaked in February 2020.
“We entered this week with a positive outlook on the Biden administration’s attempt to deliver a sizeable package,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. “Markets have welcomed this with positive moves.”
In contrast, utilities and real estate were among the S&P 500 sectors with the highest percentage losses. Utilities and real estate, due to their constant earnings and high dividend yields, are often considered bond prosecutors and tend to move in tandem with treasuries. Homeowners’ shares, which are sensitive to the rate, have also fallen.
Technology stocks have also declined. This sector includes many stocks with high earnings multiples, which may also be under pressure with rising returns, according to market analysts.
The S&P 500 retreated from session highs as yields rose on Tuesday, reflecting investor concerns about the day-to-day rise in bond yields, said Robert Phipps, director of Per Stirling Capital Management in Austin, Texas. The stock would probably tolerate a gradual rise in rates, but a higher sprint could create turbulence, in his opinion.
“Even if interest rates are still very low, the stock market will be very, very sensitive to change,” he said.
Unofficially, the Dow Jones industrial average rose 61.52 points, or 0.2%, to 31,519.92, the S&P 500 lost 2.38 points, or 0.06%, to 3,932.45, and the Nasdaq Composite decreased by 47.98 points or 0.34% to 14,047.50.
A sharp decline in new coronavirus infections, progress in vaccinations and a stronger-than-expected earnings season in the fourth quarter have boosted hopes of a quick recovery in the business this year.
This week’s earnings reports from Hilton Worldwide Holdings Inc., Hyatt Hotels Corp., Marriott International Inc., Norwegian Cruise Lines and TripAdvisor Inc. will be closely monitored for signs of rising global travel demand.
Shares of cryptocurrencies and blockchain-related companies, including Silvergate Capital Corp, Riot Blockchain and Marathon Patent Group, have risen as Bitcoin has briefly surpassed $ 50,000.
Investors will also focus this week on the minutes of the January meeting of the Federal Reserve, where it reaffirmed its commitment to maintaining a balanced political stance. (Reporting by April Joyner; Additional reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Saumyadeb Chakrabarty and Cynthia Osterman)