Dow rebounds in a roller coaster week

It was another tough day on Wall Street for most of the FAANGs and other Big Techs, as investors fled growth stocks for value sectors. But the Dow held up a little better, thanks to gains in cyclical oil and industrial giants such as Chevron (CVX), Dow (DOW), Caterpillar (CAT), Honeywell (HON) and 3M (MMM.)

Federal Reserve chair Jerome Powell and Treasury Secretary Janet Yellen reiterated their hopes for a continued recovery during testimony before the Senate Banking Committee about Covid-19’s impact on the economy. Long-term bond yields stabilized, too, giving a boost to bank stocks.

The Dow was flat.

The S&P 500 was down 0.6%.

The Nasdaq Composite fell 2%.

As stocks settle after the trading day, levels might still change slightly.

Non-fungible tokens are all the rage these days. Twitter CEO Jack Dorsey’s first tweet just sold as an NFT for nearly $3 million. Toilet paper brand Charmin has an NFT, and there’s even a digital house that fetched a half million dollars. Heck, the CNN Business tech team has splurged on its very own feline-themed token.

So is this mania for investing in NFTs starting to look like an irrationally exuberant bubble? Yes and no.

Lo Toney, founding managing partner of Plexo Capital, told CNN’s Alison Kosik on the Markets Now show Wednesday that investors should watch what millennials and Gen Zers are doing.

“Without a doubt, you need to look at younger generations for the future of investing,” he said, noting that NFTs are a great way for artists to generate longer-term royalty streams through the sale of tokens.

That said, shares of several companies have surged this week for no other reason than the companies are planning (or might plan) some sort of NFT strategy.

Collectibles maker Funko (FNKO) soared 10% Tuesday and was up more than 10% Wednesday on NFT hopes for selling digital tokens tied to its pop culture figurines.

Shares of digital entertainment firm Cindeigm (CIDM), Canton, Ohio-based football-themed company Hall of Fame Resort & Entertainment (HOFV) and marketing firm Dolphin Entertainment (DLPN) have also surged this week thanks to NFT news and chatter.

That’s where things are starting to get a bit bubblicious.

“Is this a little overheated?” Toney said on the Markets Now show. He answered his own question by saying that he was seeing more and more companies putting out press releases touting their NFT strategy.

It’s been a bumpy ride for tech stocks lately. But that’s not scaring away one top VC from the sector.

Lo Toney, founding managing partner of Plexo Capital, told CNN’s Alison Kosik on the Markets Now show that he “absolutely” remains bullish on tech stocks for the long haul.

“Right now, the market is trying to sort things out,” he said about the volatility in the Nasdaq.

Toney said that Tesla (TSLA) is one of the stocks that he likes, but he feels that a recent price target of $3,000 that Cathie Wood’s ARK Invest put on the stock is extreme.

“I’m an enormous Elon Musk fan and huge bull, but at $3,000 it is going to have to be priced to perfection to reach that target,” he said.

Toney said that one of his favorite tech stock picks right now is Adobe (ADBE), the software giant that has many tools geared toward the burgeoning creator community of people running their own online video, blogging and social media businesses.

“Adobe is a very interesting company in the creator economy. There are all these individuals doing things under their own shingle,” he said.

Toney also does not fear the possibility of more federal regulations from the Biden administration on Big Tech and social media firms.

“This has been a long time coming,” Toney said, adding that a hands off approach from regulators 20 years ago was “the right thing to do” but that “we’re at a point now where tech is so intertwined in our lives and there are repercussions geopolitically.”

“We need to take a step back and understand the challenges,” he said, noting that as long as the government doesn’t overstep, investors have already priced in more tech regulations.

With more states legalizing the use and sale of marijuana for consumers, the CEO of one Canadian cannabis company thinks the industry is about to become a lot more lucrative.

Miguel Martin, who runs Aurora Cannabis (ACB), told CNN’s Alison Kosik on the Markets Now show that there is “no question” that Aurora is well on its way to achieving profitability now that the US, Mexico and many other markets are opening up for legal pot sales.

Martin also said that he expects the US Food and Drug Administration to play a more active role in cannabis regulation going forward.

But the big challenge for his firm and other cannabis stocks, he said, is that the there has been an “arms race” going on in many countries where legal recreational cannabis use is still relatively new. Companies have had to spend a lot to attract consumers.

“It’s only recently that there has been focus on fundamentals, and that’s not just for Aurora. But we’re on the right track,” he said.

The good news, he added, is that the medical marijuana business is profitable and has “heathy” margins.

As for the company’s volatile stock price, which is up more than 10% this year but trading more than 50% below its 52-week high, Martin said he doesn’t blame analysts for being skeptical. “We have to prove to Wall Street that we can consistently deliver profitability, he said, adding that “the future is bright for cannabis.”

He argued that Aurora has a good business model and will be a great long-term investment.

Last year was a challenging one for many investors – but especially for women starting their own companies. Venture capital funding for female-led companies fell more than 25% in 2020.

But Anu Duggal, founding partner of Female Founders Fund, told CNN’s Alison Kosik on the Markets Now show that “2021 is off to a great start” for women in the tech sector.

Duggal pointed out that social media firm Bumble (BMBL), led by Whitney Wolfe Herd, enjoyed a strong debut when it went public. And genetic testing firm 23andMe, led by Anne Wojicki, is going public through a merger with a Richard Branson-backed special purpose acquisition company, or SPAC.

“There are so many ares where there is innovation and there is a ton of liquidity,” Duggal said about other female-led startups. She said her firm is particularly excited about consumer, health care and social media companies.

“Given the work from home environment, which to a certain degree is here to stay, there is a need for community,” Duggal said. And that’s a big reason why her firm has invested in Peanut, a social media firm geared toward mothers, as well as Co-Star, an astrology and zodiac app.

Senator Elizabeth Warren teed off on fellow Democrat Janet Yellen today over a disagreement about what makes a company “too big to fail.”

Although Congress a decade ago gave regulators the ability to scrutinize extra-big banks with assets of $50 billion or more, it also said non-banks could be included in the “too-big-to-fail” list as well.

So Warren wanted to know why Treasury Secretary Yellen and the Biden administration weren’t more concerned that BlackRock manages $9 trillion in assets – more than the annual GDP of any country not named the United States or China.

“If a $9 trillion investment company failed would that likely have a significant impact on our economy?” Warren asked Treasury Secretary Janet Yellen.

After a back and forth about a focused investigation performed by the Treasury under former President Donald Trump, Yellen conceded that she thinks “it’s appropriate to designate institutions whose failure would pose a material risk to US financial stability,” and pledged to investigate further.

Warren, not too happy with the response, called for more immediate action.

“When the party is going strong, it’s the job of the regulators to take away the punchbowl,” she said. “My view on this is Congress gave you the tools to monitor the risk and it is important to use them.”

It’s another weird day on Wall Street.

Tech had been leading the charge this morning as bond yields fell yet again. That gave investors some peace of mind that higher debt costs wouldn’t cut quite so much into riskier tech companies’ bottom lines.

But then Wall Street started selling off 10-year bonds, sending the yield higher to 1.65%, sending tech into reverse and pushing value stocks higher.

Here’s where major indexes stand now:

The Dow surged 330 points, or 1%

The S&P 500 rose 0.6%

The Nasdaq was down 0.1%.

Market volatility continues to creep lower, even as investors fret about seemingly everything: the pace of the recovery, rising bond yields, inflation, increasing Covid infections and a host of other concerns.

The VIX volatility index fell below 20 again today (lower numbers indicate less volatility). On Monday, the Vix closed below 20 for the first time since February 2020, right before the pandemic took hold of Wall Street’s attention.

Lower volatility doesn’t necessarily mean smooth sailing for stocks: It’s just one of a handful of data points included in CNN Business’ Fear and Greed Index, which has fallen close to “fear” territory. But low volatility means stocks probably aren’t going to go many sharp spikes or deep dives – not for the moment, anyway.

Worried about the Census Bureau’s surprising report that manufacturing went into reverse in February? Don’t be: America’s manufacturing sector was plenty healthy in March.

Markit’s Manufacturing PMI index for March came in at 59 (anything over 50 indicates expansion). Although that was slightly below Wall Street’s forecasts of 59.6, it’s higher than February’s 58.6.

Those numbers are confusing — but suffice it to say, 59 is plenty robust.

Some investors were concerned that durable goods orders fell in February for the first time since April 2020 (see two posts below this one). But most were cautiously optimistic that February was a winter-weather-induced blip. Today’s PMI report suggests that’s probably the case.

The Fearless Girl statue stands in front of the New York Stock Exchange in New York's Financial District, Tuesday, March 23, 2021.

US stocks opened higher ahead of a second day of congressional testimony on the state of the economy from Janet Yellen and Jerome Powell at noon.

Investors continued to buy bonds, sending the 10-year yield lower for the fourth-straight day, to near 1.6%.

But stocks have seesawed lately as Wall Street tries to get its head around whether the economic recovery will take hold as strongly and quickly as previously believed as Covid cases continue to mount. Conversely, they’re worried that the sugar rush from the stimulus will send prices higher, eating into corporate profits.

This morning, at least, investors were in a more optimistic mood.

The Dow rose 140 points, or 0.4%

The S&P 500 was up 0.4%

The Nasdaq was also 0.4% higher