Panic-buying signs surface in tech-heavy Nasdaq Composite Thursday morning

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Trading in the Nasdaq Composite was exhibiting panic-like-buying behavior Thursday morning, after chaos at the Capitol on Wednesday yielded to President Trump agreeing to an orderly transition of power after Congress ratified President-elect Joe Biden’s victory in the wee hours of the morning. The Nasdaq Composite was trading 1.5% higher at 12,926, while the Nasdaq Arms Index, a volume-weighted breadth measure, fell to 0.387. Many on Wall Street see declines below 0.500 as suggesting panic buying. The Arms Index is calculated by dividing the ratio of the number of advancing stocks over decliners by the ratio of the volume of advancing stocks over declining volume. As the stock market rises, the Arms often falls below 1.000, as the buyers rush into advancing stocks. The number of stocks advancing on the Nasdaq on Thursday outnumbered decliners by nearly 3 to 1, with volume in advancing stocks representing about 90% of total volume on the Nasdaq Composite. Meanwhile, the Dow Jones Industrial Average was trading 90 points, or 0.3%, higher at 30,905, in record-high territory, while the S&P 500 index was trading 0.9% higher at around 3,780, also near a record closing high.
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