Overview
On Tuesday, U.S. stock markets closed lower as the Nasdaq Composite led declines with a 1% drop, driven by tumbling semiconductor stocks and a broad selloff in the energy sector. The market’s mixed response to earnings reports contributed to the decline, while investors remained cautious about future Federal Reserve rate policies and geopolitical risks.
- Dow Jones Industrial Average: Fell 0.75% to 42,740.42
- S&P 500: Lost 0.76% to 5,815.26
- Nasdaq Composite: Dropped 1.01% to 18,315.59
Fear & Greed Index
Neutral – Investors balanced weak chip demand with positive signals from selective earnings reports while keeping an eye on upcoming economic data and interest rate policies.
Sector Performance
- Winners:
- Real Estate: Gained 1.2%, showing resilience as a defensive play.
- Consumer Staples: Increased 0.6%, supported by cautious investors amid market volatility.
- Utilities: Up 0.5%, benefiting from a defensive shift in sentiment.
- Losers:
- Technology: Declined 1.8%, driven by concerns over AI chip exports and weak semiconductor outlooks.
- Energy: Fell 3%, marking its steepest decline in over a year as oil prices dropped on reports that Israel may not target Iranian oil facilities.
Key Movers
- Nvidia (NVDA): Dropped 4.7% following a media report suggesting the Biden administration might limit AI chip exports.
- ASML Holdings: Tumbled 16% after disappointing sales forecasts for 2025, leading a 5.3% drop in the Philadelphia Semiconductor Index.
- Apple (AAPL): Rose 1.1%, bucking the technology sector’s downward trend, and touched a record high during the session.
- Walgreens Boots Alliance (WBA): Surged 15.8% after narrowly beating Wall Street’s expectations and announcing plans to close 1,200 stores.
Economic Data
- Earnings Reports:
- Bank of America: Rose 0.5% on third-quarter profit beats.
- Charles Schwab: Gained 6% after exceeding earnings estimates.
- Citigroup: Declined 5% due to mixed results and weaker-than-expected net interest income.
- Fed Policy:
- San Francisco Fed President Mary Daly emphasized that inflation control remains a priority even after September’s rate cut.
- Traders expect a 98% chance of another 25-basis-point rate cut in November, according to CME’s FedWatch tool.
Outlook
Investors will focus on upcoming retail sales and industrial production data, which will offer insights into the health of the U.S. economy. Additionally, more corporate earnings reports are expected in the coming days, which could shape market sentiment. Defensive sectors such as real estate and utilities are likely to remain in favor amid ongoing market volatility. Meanwhile, chip stocks may face further pressure unless stronger earnings results offset export-related concerns.