US STOCKS-Dow hits record in stock rally as inflation fears recede

* Koss doubles in value; GameStop in volatile trading
* Yields lower after 10-year Treasury note auction
* Benign inflation reading helps lift stocks

(Adds close at 4 p.m.)
By Karen Pierog and Herbert Lash
March 10 (Reuters) - The S&P 500 rose on Wednesday and the
blue-chip Dow hit a record high after tepid consumer price data
for February calmed inflation worries and Congress gave final
approval to one of the largest economic stimulus measures in
U.S. history.
A rotation into sectors such as energy and financials
continued, both in small- and large-cap stocks, as investors bet
on consumer spending when the U.S. economy reopens and sold the
big tech names that have fueled the rally since last March.
An expected economic surge once the coronavirus vaccines are
rolled out along with the monster fiscal stimulus have triggered
inflation fears and a spike in Treasury yields, leading the
Nasdaq to tumble as much as 12% from its Feb. 12 record close.
But an auction of $38 billion in benchmark 10-year Treasury
notes was not as bad as feared as underlying inflation remained
muted, helping push yields down to a session low of 1.506%.
The "market seemed nonplussed and Treasuries rallied but
that didn't seem to give a boost to tech (stocks)," said Mark
Luschini, chief investment strategist at Janney Montgomery
Scott.
Rising yields have weighed on technology shares as they rely
on cheap funding for growth.
Investors are shifting funds from tech stocks with lofty
valuations to other groups, such as energy and financials, that
are undervalued and more of a play on an improving economy in a
post-COVID world than big tech is, said Peter Tuz, president of
Chase Investment Counsel in Charlottesville, Virginia.
"It is occurring in fits and starts," Tuz said. "That is
essentially the overwhelming theme in the market right now and
it probably will continue until these things run their course."
The move away from Apple Inc AAPL.O , Amazon.com Inc
AMZN.O , Facebook Inc FB.O , Tesla Inc TSLA.O and Microsoft
Corp MFST.O , all down on the day, led small-cap stocks .SPCY
to rise more than double the gains of the S&P 500.
Also helping lift equities are rising estimates for U.S.
corporate profitability this year following surprisingly strong
fourth-quarter earnings and growing optimism about the recovery.
Unofficially, the Dow Jones Industrial Average .DJI rose
1.45% to end at 32,295.71 points, while the S&P 500 .SPX
gained 0.60% to 3,898.73.
The Nasdaq Composite .IXIC dropped 0.04% to 13,068.83.
Shares of Roblox Corp RBLX.N jumped 54% at one point in
its New York Stock Exchange trading debut, valuing the U.S.
gaming company at more than $42 billion and making it one of the
most active stocks on the NYSE. The Nasdaq closed lower in choppy trade after logging its
best one-day percentage jump in four months on Tuesday.
The sweeping $1.9 trillion COVID-19 relief bill passed by
the U.S. House of Representatives gave President Joe Biden his
first major victory in office. Some of the $1,400 in payments heading to most Americans
could end up in the stock market and could provide a boost for
GameStop GME.N and other stocks popular among retail investors
active in online social media forums. Trading in GameStop GME.N gyrated wildly after multiple
NYSE trading halts as shares of the video game retailer and
other so-called meme stocks approached levels last seen during
their late January rally. Among other "meme" stocks, Koss Corp KOSS.O soared, rising
as much as 70% before the bell.