The Dow Jones Industrial Average closed at a fresh all-time high Tuesday, climbing about 0.9% to near 52,170. But the broader market told a different story: the S&P 500 slipped roughly 0.25% to around 7,540, and the Nasdaq Composite fell 0.61%, dragged down by a profit-taking wave in semiconductor stocks. The Russell 2000 also dropped 0.47%.
Chip stocks take a hit
Technology was the worst-performing sector in the S&P 500, down 1.50%, and the pain was concentrated in chips. Nvidia fell 1.47%, Advanced Micro Devices dropped 4.22%, Micron lost 2.89%, Broadcom slid 3.79%, and Intel tumbled 5.62%. Investors appeared to be locking in gains after a long run-up in chip names, though no single catalyst triggered the selloff.
Oil deal sparks rotation into industrials, financials
Brent crude fell below $80 a barrel for the first time since early March after the U.S. and Iran reached a deal to ease tensions. That drop in oil prices fueled a sharp rotation: industrials surged 2.88%, and financials rose 1.41%. Energy, meanwhile, was the second-worst sector, down 0.57% as crude slid.
Housing starts tumble to lowest since 2020
Housing starts fell 15.4% in May to a seasonally adjusted annual rate of 1.177 million, the weakest pace since 2020. The sharp decline added to concerns about the broader economy and came as the Federal Reserve opened its two-day policy meeting — the first led by new Chair Kevin Warsh. Markets expect no change in interest rates this time around.
SpaceX rockets past Amazon on $60 billion AI deal
SpaceX jumped about 12%, overtaking Amazon to become the fifth-largest U.S. company by market value after announcing a $60 billion all-stock deal to buy AI coding firm Cursor. The move is a huge bet on AI, but SpaceX lost money last year, raising questions about whether the rally reflects real value or speculative froth. In a separate tech move, Western Digital rose more than 7% on AI-driven storage demand and a Morgan Stanley price-target hike.
On the chart, the S&P 500 showed a bull flag breakout from Monday. Traders are watching the 7,597 level as the next resistance to reclaim, with key support at 7,376 and 7,240. Whether the rotation into cyclicals can sustain momentum — and whether the Fed signals anything new — will shape the rest of the week.
