NEW YORK (AFP) – Wall Street investors shifted their patterns on Thursday (June 17), buying technology giants and shunning financial and energy equities as long-term bond yields retreated.

A day after the Federal Reserve signalled an earlier timeframe for hiking interest rates, investors sold bank and energy shares that have done well in 2021, steering funds to tech giants that have underperformed.

“The good news is money is not rotating out of the market, it’s just rotating into growth stocks,” said Art Hogan, chief strategist at National Securities.

Shares of Apple, Facebook and Amazon all rose more than 1 per cent, leading to a 0.9 per cent jump in the tech-rich Nasdaq Composite Index to 14,161.35.

The Dow Jones Industrial Average ended down 0.6 per cent at 33,823.45, while the broad-based S&P 500 slipped less than 0.1 per cent to 4,221.86.

The Fed on Wednesday maintained highly accommodative monetary policy as expected, but a majority of central bank officials now believe interest rates will increase in 2023, rather than 2024. Several policymakers projected interest rate hikes as soon as 2022.

But the yield on the 10-year US Treasury note, which rallied on Wednesday, pulled back on Thursday.

Karl Haeling of LBBW said market participants were broadly adjusting investments after the Fed announcement boosted the dollar.

“We don’t believe the Fed’s communications Wednesday will prove to be a game-changer in terms of the overall direction of Treasury and equity price trends,” he said in an analysis.

“But we do see the latest FOMC creating significant changes to the composition of global market investment activities going forward,” he said, noting that “Most market participants had expected a fairly sleepy Northern Hemisphere summer.”

Tech stocks drive Nasdaq to higher close