Dow opens higher but tech decline pressures S&P 500 and Nasdaq

The Dow Jones industrial average opened higher on Tuesday as McDonald's shares rose. But a decline in tech stocks pushed the S&P 500 and Nasdaq lower.

The 30-stock index rose 38 points, with McDonald's leading advancers.

The S&P 500 opened lower, as tech fell nearly half a percent. The Nasdaq composite also opened lower.

Shares of Bank of America traded slightly higher after the bank announced it would buy back an additional $5 billion in stock. The repurchase will take place through June 2018. Morgan Stanley, JPMorgan Chase and Citigroup also saw their stocks climb in the premarket.

Bank shares have been on fire recently, as expectations of lower corporate taxes have increased. The SPDR S&P Bank exchange-traded fund (KBE) is up more than 4 percent over the past week.

Tech shares, meanwhile, have cooled off recently. Over the past week, the tech sector has fallen more than 3 percent.

The Senate passed a key bill over the weekend that moved the Republicans closer to overhauling the corporate tax system and significantly lower corporate taxes. In theory, the proposed chanes would help banks and financials more than tech companies, since they pay a higher effective tax rate.

The proposed tax cuts "help explain the rapid sector rotation last week away from technology stocks into the financial sector," said Bruce Bittles, chief investment strategist a Baird. "The rotation out of tech to the financials is seen as a positive development as the financials have a long history as market leaders."

In corporate news, Snap shares shot 5.4 percent higher in the premarket after Barclays said the social media could hit a "turning point" in 2018.

AutoZone shares also ticked higher after the company reported better-than-expected quarterly results.

Read Again Dow opens higher, but tech decline pressures S&P 500 and Nasdaq : http://ift.tt/2BACqB1

Let's block ads! (Why?)