US Stocks Diverge: Dow Hits Record High as Tech Pulls Nasdaq Lower

Wall Street experienced a significant divergence on Tuesday as investors rotated out of high-flying technology stocks and into more traditional sectors. While the Nasdaq and S&P 500 faced downward pressure, the Dow Jones Industrial Average continued its momentum, marking its second consecutive record close.

Sector Rotation: Tech Slump vs. Dow’s Record Surge

The market witnessed a distinct shift in investor sentiment as capital moved away from richly valued technology stocks toward economically sensitive sectors. After a massive rally on Monday—where the Nasdaq jumped over 3% and the S&P 500 climbed 1.65%—traders opted to take profits and digest recent gains.

The impact on the major indices was clear:

Chip stocks, which had seen significant surges in the previous three sessions, were among the hardest hit during this rotation.

Geopolitical Shifts and Falling Oil Prices

Oil prices played a crucial role in the day's market dynamics, settling down by 5.8%. This decline follows emerging details regarding a U.S.-Iran interim deal. The agreement, which aims to extend a tenuous ceasefire for an additional 60 days, is expected to reopen the Strait of Hormuz.

With President Trump stating the deal rules out nuclear weapons for Tehran, the potential for Iran to sell oil upon signing has eased fears of supply disruptions. For investors, lower oil prices are a double-edged sword: they provide relief to equities but also influence the "sticky inflation" narrative that governs central bank policy.

Anticipation of the Federal Reserve's Decision

The primary driver of current market caution is the upcoming Federal Reserve policy update. Investors are largely expecting the Fed to maintain interest rates in the current 3.50% to 3.75% range. However, all eyes are on new Fed Chairman Kevin Warsh for guidance on inflation, unemployment, and the broader economic outlook.

CME Group-এর FedWatch টুল অনুযায়ী, ব্যবসায়ীরা বছরের বেশিরভাগ সময় সুদের হার স্থিতিশীল থাকবে বলে আশা করলেও, বর্তমানে ডিসেম্বরে ২৫ বেসিস পয়েন্ট সুদের হার বৃদ্ধির ওপর বাজারের প্রায় ৪২% বাজি রয়েছে।

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