After two days of panic selling due to jitters over too much Q1 optimism, today was another day of tide reversal picking up bargains and switching back to tech, though frankly all indexes had a good day with both value and growth doing very well. Netflix was the one wild card today as, with the pandemic slowing down new programming as it has, subscriber growth fell in Q1 bringing the stock down 7.4 percent and putting a drag on an otherwise energetic market. The VIX again fell below 18 suggesting the market is shrugging off the COVID spikes. Volume was again below average at 9.2 billion. 

Wed  April 21, 20214:31 PM EDT

Wall Street rebounds after two-day decline; Netflix slides

Shreyashi Sanyal, Devik Jain, Herbert Lash

DJ: 33,821.30  -256.33        NAS: 13,786.27  -128.50       S&P: 4,134.94  -28.32      4/20

DJ: 34,137.31  +316.01       NAS: 13,950.22  +163.95       S&P: 4,173.42  +38.48     4/21

Wall Street rebounded on Wednesday after a two-day decline in a broad rally as a tilt toward stocks poised to benefit from a recovering economy offset Netflix Inc's (NFLX.O) sell-off after its disappointing results a day earlier.  Shares of Netflix slumped 7.4% after the world's largest streaming service said slower production of TV shows and movies during the pandemic hurt subscriber growth in the first quarter. read more  But stocks rallied throughout the day, building steam as the tech-heavy Nasdaq Composite Index (.IXIC) overtook the S&P 500 (.SPX) in percentage gain shortly before the close.

Intuitive Surgical Inc (ISRG.O) surged 9.9%to an all-time high as its results trounced estimates. The maker of robotic surgical systems vied with Microsoft Corp (MSFT.O) and Tesla Inc (TSLA.O) for much of the session as the biggest contributor to the S&P 500's (.SPX) upside.

Nine of the 11 S&P 500 sectors rose, with communication services (.SPLRCL), led by Netflix, and the defensive utilities (.SPLRCU) sectors falling.  Economically sensitive value stocks (.RLV) rose 1.1%, outpacing the 0.8% gain in growth (.RLG) even as the growth-oriented but more concentrated Nasdaq climbed more than the S&P.  The Russell 2000 Index (.RUT) of small-cap stocks gained 2.4% in its biggest single-day advance since March 1.

"You take Netflix out of today's equation, it's simply a broad-based rally," said JJ Kinahan, chief market strategist at TD Ameritrade, adding technology shares still had room to run.  The VIX (.VIX), CBOE's market volatility index, slid below 18, suggesting the market in days to come could be range-bound while shrugging off a rebound in COVID infections, he said.

Analysts expect S&P 500 companies to post first-quarter earnings growth of 30.9% from a year earlier, Refinitiv IBES data shows.

Netflix's results dashed expectations but technology remains a major market focus.  "Investors feel more confident of the earnings growth prospects for technology," said Sam Stovall, chief investment strategist at CFRA Research in New York."They would rather gravitate toward the sure thing, which right now is tech stocks."

The Nasdaq Composite (.IXIC) added 1.19% to 13,950.22. The Dow Jones Industrial Average (.DJI) rose 0.93% to 34,137.31, while the S&P 500 (.SPX) gained 0.93% at 4,173.42.

Volume on U.S. exchanges was 9.22 billion shares, down from 10.44 billion average for the full session over the previous 20 trading days.

Verizon Communications Inc (VZ.N)slid 0.4% after it lost more wireless subscribers than expected in the first quarter. Shares of T-Mobile US Inc (TMUS.O) and AT&T Inc (T.N) rose. read more  U.S. railroad operator CSX Corp (CSX.O)rose 4.3% even after it missed estimates for first-quarter profit, hurt by frigid polar vortex temperatures, ongoing pandemic disruptions and higher fuel costs. read more

Advancing issues outnumbered declining ones on the NYSE by a 3.82-to-1 ratio; on Nasdaq, a 3.55-to-1 ratio favored advancers.  The S&P 500 posted 86 new 52-week highs and no new lows; the Nasdaq Composite recorded 71 new highs and 58 new lows.