By Rodrigo Campos
(Reuters) - The S&P 500 and Nasdaq Composite rose on Wednesday following three days of losses as tech shares advanced, while the blue-chip Dow index ticked lower, weighed by Disney's largest daily drop in almost seven years.
Gains in major tech companies Google
"There's been a sector rotation into technology because of the improvement in their earnings expectations," said Chad Morganlander, portfolio manager at Stifel, Nicolaus & Co in Florham Park, New Jersey.
Earnings in the technology sector of the S&P 500 are expected to have grown 5.3 percent in the second quarter, up from a 2.1 percent increase expected back on July 1, according to the most recent Thomson Reuters I/B/E/S data.
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The market's advance is, however, "a modest bounce back after discernable pressure over the last trading sessions," Morganlander said. He cited deceleration in the Chinese economy as a continuing headwind for stocks, specifically commodities-related sectors.
Disney's
Shares of Comcast
"Disney has had such a tremendous move in the past months that a setback within the stock price should not be a surprise," said Morganlander.
The Dow Jones industrial average <.DJI> fell 10.22 points, or 0.06 percent, to 17,540.47; the S&P 500 <.SPX> gained 6.52 points, or 0.31 percent, to 2,099.84; and the Nasdaq Composite <.IXIC> added 34.40 points, or 0.67 percent, to 5,139.95.
Despite the gains on the S&P 500, declining issues slightly outnumbered advancing ones on the New York Stock Exchange by 1,542 to 1,518. On the Nasdaq, however, 1,606 issues rose and 1,203 fell.
U.S. private job growth slowed in July, but a surge in services industry activity to a near-decade high suggested solid economic momentum that strengthens the case for a Federal Reserve interest rate hike this year. Friday's payrolls report is key for traders who are trying to anticipate the Fed's next move.
First Solar
Shares of Chesapeake Energy
The benchmark S&P 500 index posted 54 new 52-week highs and 31 new lows; the Nasdaq Composite recorded 135 new highs and 107 new lows.
About 7.2 billion shares changed hands on all U.S. exchanges, compared with an average 6.78 billion in the past five sessions, according to BATS Global Markets data.
(Reporting by Rodrigo Campos; Editing by James Dalgleish)