At the close, the Nasdaq Composite plunged as investors were selling tech stocks that provoked rallies on the US stock exchange at the beginning of 2021.
Thus, the Nasdaq Composite lost 0.6% and settled at 13,965.49, while the S&P 500 slipped by 0.1% to 3,931.33.
At the same time, the Dow Jones Industrial Average advanced by 0.3% to 31,613.02, logging its ninth close at a record level this year.
The rally in the US stock market, in the course of which the major indexes hit new record highs, began to gradually fade away this week. Nevertheless, investors still feel positive, anticipating the US stimulus plan to be approved by the government and the pace of COVID-19 vaccination campaign to accelerate.
Yesterday, the US revealed its retail sales data. The reading turned out to be higher than expected. At the end of 2020, during the pre-holiday season, this indicator sagged for three months in a row.
Investors are concerned about overvalued stocks, as well as growing inflation expectations. No doubt, stimulus measures and increased government spending in the United States have influence on stock indices.
In addition, market participants are closely watching the 10-year government bond yield, which is growing steadily after sinking by more than 1.0% at the beginning of the year. At yesterday's close, the indicator came in at 1.297% against 1.298% on Tuesday.
A steady increase in government bond yields has changed investors' attitude towards risk. One more reason for yield growth was the high value of many stocks. According to experts, the low yield on US bonds sparked interest in the stock market in previous months.
Some investors remain optimistic, hoping that monetary policy in the United States will continue to support both the market and the economy. Last week, Fed Chairman Jerome Powell said that the regulator did not plan to roll back monetary stimulus measures by means of higher interest rates or reduction of bond purchases in the short term.
Warren Buffett's Berkshire Hathaway has disclosed sizable stakes in Verizon Communications and Chevrons. As a result, shares of both companies gained 5.2% and 3.0% respectively.
Quotes of the largest tech companies, on the contrary, dropped. Thus, shares of Apple, Netflix, and Facebook sank by 1.8%, 1.1%, and 0.2% accordingly.
In the upcoming days, investors will be focused on corporate reporting. On Thursday, giants Walmart and Marriott International will reveal their statistics. By the way, market participants were pleased to see positive results published by large American corporations.
US natural gas futures settled up 2.9% and closed higher for a third straight session.
Gold plunged by 1.5% and ended lower for the fourth day in a row.
Stoxx Europe 600 tumbled by 0.7%.
Asian stock markets closed mixed. Japan's Nikkei 225 fell by 0.6%, while Hang Seng surged by 1.1%. China's stock exchange is still closed for the Lunar New Year holiday.
