By Yasin Ebrahim
Investing.com – The S&P 500 cut losses to turn positive Thursday, led by dip-buying action in tech stocks after Russia launched a full-scale invasion of Ukraine.
The S&P 500 rose 1.1%, the Dow Jones Industrial Average fell 0.19%, or 62 points, the Nasdaq rose 2.95% after falling into bear market territory intraday with a 20% decline from a recent peak.
Russia launched its assault on Ukraine, invading the country from multiple sides, triggering condemnation from world leaders and ratcheting up geopolitical tensions.
The U.S. responded with fresh sanctions on Russia aimed at further crippling Moscow’s ability to raise funds and to import key technology.
“Commodities prices moving higher against the backdrop of a market already in correction territory and facing the prospect of rising rates, points to a bleak market outlook," Phillip Toews, CEO & portfolio manager of Toews Asset Management, told Investing.com on Thursday.
The weakness that followed in stocks, however, triggered dip-buying, with battered tech stocks in demand.
Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Meta Platforms (NASDAQ:FB), Alphabet (NASDAQ:GOOGL) and Microsoft (NASDAQ:MSFT) were higher.
The rebound in big tech comes as some on Wall Street urged investors to act with caution, and focus on higher tech quality stocks with healthy level of cash flows.
“[W]e view these geopolitical shock events as times not to panic … but instead selectively focus on the defensive tech stocks with significant free cash flow,” Wedbush said in a note.
The quarterly earnings season also prove to be a bright spot.
Moderna (NASDAQ:MRNA) rallied 14% after raising its full-year guidance on Covid-19 vaccine sales following fourth-quarter results that beat on both the top and bottom lines.
Booking Holdings (NASDAQ:BKNG) also reported better-than-expected quarterly results, but said it was still wary of future Covid-19 related travel restrictions holding back growth.
Live Nation Entertainment (NYSE:LYV), meanwhile, rose more than 9% after reporting a healthy outlook for 2022 ticket sales and better-than-expected quarterly revenue.
With the broader market in correction, some investors flagged higher-paying dividend stocks in sectors including health care and communications services as potential areas of interest that can somewhat blunt the impact of a market crash.
“In falling markets, it's not about having the best gain, but having the least loss,” Toews said. “Higher dividend stocks provide a sort of natural rebound because as the price of the stocks fall, a relatively reliable stable dividend in places like health care and communication services as well as other categories are unlikely to be immediately effected by a downturn in financial markets and are able to recover quicker from losses."