Record close for S&P 500, Nasdaq; bond yields fall

It was a choppy trading session on Wall Street Wednesday. Stocks ultimately rose even as investors kept a wary eye on the bond market.

The Dow ended the session with a 104-point gain. The S&P 500 gained 14 points to close at its 8th record high in 9 sessions. A volatile Nasdaq ended the day up by a single point...just enough for a record closing high as well.

Investors weren't willing to make any big bets on Fed policy. Minutes from the Fed's June meeting showed that even though policymakers discussed the idea of tapering bond purchases, the group did not feel like the economy was strong enough yet to even think about doing so....but discussed the need to be prepared to pivot if things change quickly.

That didn't shake bond yields out of a funk. Yields on the 10-year note fell for the seventh straight session to 1.32 percent, touching 4-month lows during the session.

Kevin Nicholson, co-chief investment officer of global fixed income at RiverFront Investment Group, says both the bond market and the stock market are trying to cope with an economic reality that's been downgraded.

"I think that that's what the market is seeing right now, is that we're going to have steady growth. Growth may not be at the same level that they had anticipated and that we've been talking about for months. But it's still going to be a good growth and the rate of change is just come down, I believe, and what people are anticipating."

Shares of social media companies were in focus as they face a new threat from an old foe. Former President Donald Trump sued Facebook, Twitter and Alphabet's Google, as well as their CEO. In his lawsuit he alleges the companies unlawfully silence conservative viewpoints in violation of the First Amendment. Trump has been banned from social media platforms, which say he violated their policies by inciting the January 6th assault on the Capitol. Shares of Twitter were down 2 percent. Facebook lost half of one percent. Alphabet ended with a modest gain.