The S&P 500 and the Nasdaq rose in choppy trading on Wednesday as Intel shares jumped thanks to a change in management while broader sentiment was muted after a recent run to record highs.
Intel said it would replace Chief Executive Officer Bob Swan with VMware Inc CEO Pat Gelsinger next month. The chipmaker’s shares gained 7.5% to touch a six-month high.
Shares of VMware fell 5.5%.
Wall Street’s main indexes hit record highs last week as expectations of a hefty COVID-19 relief package and hopes of a rebound in corporate earnings this year eclipsed concerns over signs that the labor market recovery has stalled amid rampant COVID-19 infections.
“The market is starting to price in that there are some risks … valuation is pretty extreme, optimism is way too high, we’ve got a disappointing rollout of further vaccine,” said David Spika, president of GuideStone Capital Management in Dallas, Texas.
“The expectation is that we’ll have a significant increase in earnings and economic growth in 2021, but both are really dependent on the vaccine.”
Investors are watching events in Washington, where the U.S. House of Representatives gathered to consider impeaching President Donald Trump for his role in an assault on American democracy that stunned the nation and left five dead.
“The market is looking through the impeachment and saying we’re going to get this stimulus, which will be a bridge between now and when the vaccine can be adequately distributed,” Spika added.
Seven of the 11 major S&P sectors rose, with real estate and utilities posting the sharpest gains.
At 11:26 a.m. ET, the Dow Jones Industrial Average rose 2.00 points, or 0.01%, to 31,070.69, the S&P 500 gained 8.80 points, or 0.23%, to 3,809.99 and the Nasdaq Composite gained 72.54 points, or 0.55%, to 13,144.98.
Earnings reports from big U.S. banks including JPMorgan and Citigroup will mark the unofficial start to the fourth-quarter earnings season later this week. Investors will gauge remarks from executives for clues on corporate America’s health.
Exxon Mobil Corp rose 1% after J.P. Morgan upgraded the stock to “overweight”, saying cuts in capital spending had put the oil major on track for a stronger performance.
Regeneron Pharmaceuticals climbed 1.5% as the U.S. government said it would buy 1.25 million additional doses of the company’s COVID-19 antibody cocktail for about $2.63 billion.
Advancing issues outnumbered decliners by a 1-to-1 ratio on the NYSE and by a 1.1-to-1 ratio on the Nasdaq.
The S&P 500 posted 37 new 52-week highs and no new low, while the Nasdaq recorded 332 new highs and 10 new lows.
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