Dow edges to record but Nasdaq falls again

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NEW YORK – The Dow finished at a fresh record while the Nasdaq retreated on Wednesday (May 5) after data showed solid private-sector hiring and rising activity in the service industry.

US private employers added 742,000 jobs in April, according to a survey from payroll services firm ADP, fewer than expected but nonetheless the fourth consecutive month of gains as the economy recovers from the Covid-19 pandemic.

The Institute for Supply Management separately said its index of service sector activity was at 62.7 per cent in April, well into expansionary territory but slightly lower than the month before, with firms navigating supply chains that had grown overwhelmed by demand as major economies reopen.

The data offers further evidence of an accelerating economic recovery, although analysts say markets continue to the rebound will cause prices to rise.

The Dow Jones Industrial Average gained 0.3 per cent to 34,230.21, setting a new all-time high.

The broad-based S&P 500 climbed 0.1 per cent to 4,167.63, while the tech-rich Nasdaq Composite Index fell 0.4 per cent to 13,582.42.

The weakness in the tech sector is among the indicators that “suggest that the near-term markets can remain choppy,” said Sam Stovall, chief investment strategist at CFRA Research.

Among individual companies, General Motors surged 4.1 per cent after reporting higher first-quarter profits and reaffirming its full-year outlook Wednesday, despite a global shortage of semiconductors that has constrained auto manufacturing.

Peloton plunged 14.6 per cent as it announced it had agreed with US safety regulators to recall some of its treadmills after multiple accidents, including one that killed a child.

Moderna fell 6.2 per cent and Pfizer was flat after US President Joe Biden’s administration announced its support for a global waiver on patent protections for Covid-19 vaccines, a move that could limit both drugmakers’ profits from their groundbreaking inoculations.

Lyft slumped 6.3 per cent and Uber dropped 3.3 per cent after the US Labor Department blocked a rule handed down under former president Donald Trump that would have prevented gig workers from demanding a minimum wage or overtime.

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