Wall Street Higher as Cyclicals Step Up Amid Tech Wreck

12 September 2020, 03: 55
Wall Street climbed Friday, as cyclical sectors like financials and industrials plugged the gap left by falling tech stocks amid a slide in Apple on worries about slowing iPhone growth. 
The Dow Jones Industrial Average rose 0.48%, or 131 points, after gaining 294 points intraday. The S&P 500 was up 0.05%, while the Nasdaq Composite slipped 0.60% in its week since March.
Investors upped their bets on cyclical stocks in financials and materials, which tend to outperform in a growing economy, on rising expectations that a prolong period of stimulus and faster pace of reopening will soon follow. 
"Ultimately, if the Fed is dovish and monetary policy is easy, markets have a backstop. In other words, we must still buy the dip," said Fundstrat Founder Tom Lee said in note Thursday.
Lee also backed "epicenter" stocks, or those impacted by the pandemic. These stocks "are going to be primary contributors to EPS growth in 2021, thus, we see better risk/reward."
Tech moved off its lows of the day, but ended the week negative, led by weakness in the Fab 5. Facebook (NASDAQ:FB) Alphabet (NASDAQ:GOOGL) Amazon.com (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL) ended the day lower.
Apple came under added pressure after JPMorgan raised concerns about slowing sales ahead of the tech giant's 5G-enabled iPhone slated to launch later this year.
There was “a moderation in momentum" for the lower-end iPhone SE  and a slow down in sales of the iPhone 11, JPMorgan (NYSE:JPM) analyst Samik Chatterjee said in a note, citing surveys from Wave7 Research. 
Adding to worries over Apple's growth, the company on Friday revised its App Store guidelines that will likely directly affect game streaming services ahead of a new iPhone software release later this month.
On the earnings front, Peloton Interactive (NASDAQ:PTON) fell more than 4% even as the company delivered better-than-expected guidance and swung to a profit in its fiscal fourth quarter following a pandemic-led jump in sales.
Oracle (NYSE:ORCL), meanwhile, also struggled to advance despite better-than-expected quarter results that beat on both the top and bottom lines.
Energy stumbled, adding to broader market malaise, as oil prices stuttered on signs that OPEC members' commitment to stick to production cuts are waning after the United Arab Emirate pumped more oil than agreed to under the accord.     
Elsewhere, Nikola Corp (NASDAQ:NKLA) fell more 14% after Citron Research appeared to back short-seller Hidenburg's report from a day earlier, and called on the Securities and Exchange Commission to launch a probe into the firm. Nikola denied all allegations and described the Hidenburg report a "hit job" to drive short sales profit.