Stock Market Today: Big Tech Bounces Back

Cheaper shares had investors clamoring once again for growth stocks.

(Image credit: Getty Images)

The recent rotation away from growth stocks into value names took something of a pause Wednesday as the tech-heavy Nasdaq Composite outpaced the other major indexes by a wide margin.

The Nasdaq closed up 2% at 11,786, as investors took advantage of cheaper share prices created by a period of underperformance. By comparison, the Dow Jones Industrial Average finished lower by 0.1% at 29,397, while the broader S&P 500 added just 0.8% to hit 3,572.

Over the past five days, the Russell 1000 Value index had outperformed the Russell 1000 Growth index by 8 percentage points. But for a session, at least, the rotation was reversed.

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"The underperformance of the Russell 1000 Growth vs. Value indices over the past 10 days has reached a level that suggests a temporary pause in the strong relative performance for Value," writes Canaccord Genuity equity strategist Tony Dwyer.

Wednesday's top-performing stocks included the usual suspects -- (AMZN, +3.4%), Apple (AAPL, +3%) and Microsoft (MSFT, +2.6%).

Other action in the stock market today:

  • The Russell 2000 was up 0.1% to 1,736.
  • U.S. crude oil futures gained 0.1% to close at $41.49 per barrel.
  • Gold futures were off 0.7% to finish at $1,863 per ounce.

The bottom line is that it's probably an overreaction to dump your growth stocks.

After all, many of the best stocks of the pandemic should continue to outperform even after COVID-19 is gone, and many of them are growth stocks. Then there's a case to be made for promising mid-cap stocks, which offer the dual threat of both growth potential and stability.

And for a really growthy play, consider the telehealth stocks we've been evaluating. True, the nascent telehealth sector has already boomed during the pandemic, but the market for telehealth services is forecast to grow by leaps and bounds over the next five years.

Take a look at some of analysts' favorite pure-play telehealth stocks.

Dan Burrows
Senior Investing Writer,

Dan Burrows is Kiplinger's senior investing writer, having joined the august publication full time in 2016.

A long-time financial journalist, Dan is a veteran of SmartMoney, MarketWatch, CBS MoneyWatch, InvestorPlace and DailyFinance. He has written for The Wall Street Journal, Bloomberg, Consumer Reports, Senior Executive and Boston magazine, and his stories have appeared in the New York Daily News, the San Jose Mercury News and Investor's Business Daily, among other publications. As a senior writer at AOL's DailyFinance, Dan reported market news from the floor of the New York Stock Exchange and hosted a weekly video segment on equities.

In his current role at Kiplinger, Dan writes about equities, fixed income, currencies, commodities, funds, macroeconomics, demographics, real estate, cost of living indexes and more.