U.S. stock edged higher Tuesday, stabilizing after a bout of volatility that has tested investors’ confidence in the market’s monthslong rebound.
The S&P 500 added 0.4% and the Nasdaq Composite rose 0.7%, while the Dow Jones Industrial Average was up 0.1%. The moves come one day after equities retreated sharply, pushing the S&P 500 to a fourth straight day of losses, the longest losing streak for the broad gauge since late February. After a blistering summer rally, stocks have cooled this month.
“We went too far, too fast,” said Lindsey Bell, the chief investment strategist at Ally Invest. “I don’t think any of this should be a surprise.”
The turbulence entered a new phase Monday, when shares in sectors that are highly sensitive to economic growth, such as banks, materials and industrials, endured the biggest declines. Technology stocks, whose swings had weighed on markets in recent weeks, advanced.
Investors are contending with a clutch of risks that are intertwined. New cases of coronavirus are increasing in Europe, and reported new cases increased sharply in the U.S. on Monday, to 52,000. That was the highest single-day increase since Aug. 14, according to Johns Hopkins University.