Nasdaq Closes Above 10K for First Time Ever as Tech Surges

(C) Reuters.

By Yasin Ebrahim

Investing.com – The tech-heavy Nasdaq surged to a record close Wednesday, as investors continued to back growth in the wake of Fed’s unchanged decision on rates and commitment to stick with stimulus measures.

{169|Dow Jones Industrial Average}} fell 0.91%, or 247 points, the S&P 500 slipped 0.52%, while the Nasdaq Composite added 0.67%.

The Federal Open Market Committee left its benchmark rate unchanged in the range of 0% to 0.25%. The central bank forecasts that low rates will remain through 2022 and pledged to persist with its bond-buying program to ensure an eventual economic recovery will be robust.

“The committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals,” the Fed said.

Against the backdrop of lower for longer rates, investors continue to opt for growth, pushing tech stocks to record high despite some concerns about frothy valuations in the sector.

Apple and Nvidia (NASDAQ:NVDA) led the gains broader tech sector higher, with the latter ending the day up 4%.

Apple (NASDAQ:AAPL) rose about 3% as Deutsche Bank (DE:DBKGn) raised its price target on the stock to $350 from $320.

In other news, Tesla (NASDAQ:TSLA) surged 8% to close at fresh all-time highs after Wedbush Securities hiked its price target on the stock to $1,000 from $800.

The demand for Model 3 is shaping up to be stronger than expected in China heading into summer, and the easing lockdowns in the U.S. and Europe, Wedbush said. With potentially “game changing battery developments on the horizon,” Tesla has further room to run, it added.

But a slump in energy and financials offset the gains in tech, pressuring the broader market lower as a jump in Covid-19 infections amid easing restrictions nationwide prompted investors to pull some of their bullish bets financials and energy.

Chevron (NYSE:CVX) down 3.9%, Exxon Mobil (NYSE:XOM) down 5.4%, and Occidental Petroleum (NYSE:OXY) down 10.4%, were among the notable decliners in energy.

In Texas, the number of new cases reported each day has increased from an average of about 1,081 during the week ending May. 24 to about 1,527 in the past week.

Energy was also hurt by a fall in oil prices as data showing an unexpected rise in U.S. weekly crude inventories sparked renewed concerns about crude demand.

Oil inventories climbed 5.7 million barrels for the week ended June 5, the EIA said, confounding estimates for a draw of 1.7 million barrels.