Stocks finished mixed on Tuesday as investors continued to rotate out of high-flying chipmakers and into more economically sensitive and defensive corners of the market. Strong corporate earnings and a sharp drop in oil prices helped power the Dow Jones Industrial Average to a gain of more than 500 points, even as weakness in semiconductor stocks weighed on the tech-heavy Nasdaq. The moves came ahead of a busy stretch that includes a Federal Reserve interest rate decision and quarterly results from several of the market’s largest technology companies.
What Moved Markets
The Dow Jones Industrial Average climbed 537.24 points, or 1.03%, to close at 52,747.32. The broader S&P 500 added 15.61 points, or 0.21%, to finish at 7,428.78. The Nasdaq Composite bucked the trend, slipping 55.17 points, or 0.22%, to end at 24,876.91 as chip stocks dragged on the index.
The main driver was a continued shift in investor money away from semiconductors and toward sectors that tend to benefit from a steadier economy, including health care, consumer staples and materials. Oil prices tumbled, with Brent crude falling roughly 5%, which eased inflation worries and helped push bond yields lower. Falling yields and cheaper energy costs offered support to a wide range of stocks, even as the biggest AI-linked names came under pressure. Investors also stayed cautious ahead of the Federal Reserve’s policy meeting this week, when officials are expected to update their view on interest rates.
Notable Movers
Sherwin-Williams (SHW) was among the day’s best performers, rising about 8% after the paint maker reported better-than-expected second-quarter results. Coca-Cola (KO) gained roughly 5% after topping estimates on both revenue and earnings and raising its full-year outlook, a sign that consumer demand for its beverages remains healthy.
Semiconductor stocks told a very different story. Micron (MU) and Advanced Micro Devices (AMD) each fell more than 8% as the sell-off in chipmakers extended into a fourth straight session, with the VanEck Semiconductor ETF (SMH) down more than 3%. Dell Technologies (DELL) was one of the weakest names in the group, sliding 10.1% to $383.72, as investors grew more concerned about how much of the company’s business is tied to AI servers.
Looking Ahead
The focus now turns to the Federal Reserve, which is set to announce its latest interest rate decision this week. Investors will be watching closely for any signal on the path of rates, especially with oil prices easing and inflation pressures showing signs of cooling. On the earnings front, results are due from several of the market’s biggest technology companies, including Microsoft, Amazon, Apple and Meta Platforms. Those reports could set the tone for whether the recent rotation away from tech continues or whether investors return to the megacap names that have led the market higher. For now, the mixed close underscores a market weighing strong earnings against fresh questions about AI spending.