The Nasdaq Composite led losses on Wall Street on Tuesday as a renewed sell-off in technology stocks and fresh geopolitical concerns weighed on investor sentiment.
The Nasdaq fell 250.84 points, or 0.97%, to close at 25,678.82, while the S&P 500 declined 19.08 points, or 0.26%, to 7,386.65. The Dow Jones Industrial Average bucked the trend, gaining 86.10 points, or 0.17%, to finish at 50,872.11.
Market sentiment turned cautious after US President Donald Trump said Iran had shot down a US Apache helicopter patrolling the Strait of Hormuz and vowed a response, casting doubt over prospects for a lasting truce in the Middle East.
Technology counters resumed their decline after a brief rebound on Monday. The S&P 500 technology index ended 1.8% lower, while the Philadelphia Semiconductor Index slipped 1.9%.
Investors are also awaiting the release of US consumer price index data for May, which could provide fresh clues on the Federal Reserve’s monetary policy direction. Stronger-than-expected jobs data released last week has increased market expectations that the Fed could raise interest rates later this year.
Adding to market uncertainty is the highly anticipated initial public offering of SpaceX later this week. The company is reportedly seeking to raise US$75 billion at a valuation of US$1.75 trillion, potentially making it the largest IPO on record.
Among major technology names, Broadcom fell 1.1%, extending losses after its recent earnings outlook disappointed investors, while Nvidia slipped 0.2%.
Despite the weakness in growth stocks, value shares outperformed. The Russell 1000 Value Index gained 0.4%, while the Russell 1000 Growth Index declined 0.7%.
The CBOE Volatility Index, widely regarded as Wall Street’s fear gauge, climbed to its highest level since April during the trading session as investors reassessed risks surrounding geopolitical developments, inflation and interest rate expectations.
Reuters
