Dow Jones Rises 331 Points as Chip Stocks Drag Nasdaq Lower

The Dow Jones Industrial Average rose 331 points, or 0.63%, to 52,546 at 9:35 a.m. ET on Tuesday, while the Nasdaq Composite fell 0.18% to 24,932 at 9:44 a.m. ET and the S&P 500 opened 0.24% lower at 7,395.55. Heavy losses in semiconductor stocks pressured the Nasdaq as investors questioned returns on AI infrastructure spending and faced concerns about rising competition from Chinese chipmakers. Strong corporate earnings from Coca-Cola, Sherwin-Williams, and Illinois Tool Works supported the Dow. U.S. stock markets remain in a rotation phase as investors prepare for the Federal Reserve's two-day policy meeting, which began Tuesday, with the interest-rate decision due Wednesday at 2 p.m. ET.

Semiconductor Stocks Decline on AI and Competition Concerns

Semiconductor stocks extended their decline in early trading Tuesday. Micron Technology fell 8.4%, Advanced Micro Devices lost 7.7%, and Nvidia slipped 1.1%. The losses followed a sharp technology sell-off in Asia, where South Korea's Kospi plunged 10.8%. The Nasdaq traded below its 50-day exponential moving average near 25,625. Initial support stands around 24,750, followed by 24,500.

Corporate Earnings Support Dow Jones Components

Coca-Cola jumped 5.8% after reporting a 7% increase in revenue. Sherwin-Williams rose 7%, while Illinois Tool Works gained 3.7% after both companies posted stronger-than-expected quarterly profits. UPS raised its full-year sales and profit forecasts. Boeing reported stronger revenue but a wider adjusted loss than analysts expected. Investors will turn to Visa and Seagate results after Tuesday's closing bell. The S&P 500 consolidated below its 50-day moving average near 7,472 but above its 200-day average near 7,008. The 7,470-to-7,550 area remains the first resistance zone. Support stands near 7,400 and 7,300, with a deeper level around 7,126.

Treasury Yield Falls as Fed Meeting Begins

The 10-year Treasury yield stood at 4.624% at 9:47 a.m. ET, down about 2.3 basis points. The decline followed a drop in crude oil prices. The yield remained above its 50-day moving average near 4.52%. The Federal Reserve's two-day policy meeting began Tuesday. The central bank will release its interest-rate decision at 2 p.m. ET Wednesday, followed by a press conference at 2:30 p.m. ET.

FAQ

What did the Dow Jones Industrial Average do on Tuesday? The Dow Jones Industrial Average rose 331 points, or 0.63%, to 52,546 at 9:35 a.m. ET on Tuesday.

Why did the Nasdaq Composite fall on Tuesday? The Nasdaq Composite fell 0.18% to 24,932 at 9:44 a.m. ET due to heavy losses in semiconductor stocks. Micron Technology fell 8.4%, Advanced Micro Devices lost 7.7%, and Nvidia slipped 1.1%.

When will the Federal Reserve release its interest-rate decision? The Federal Reserve will release its interest-rate decision at 2 p.m. ET Wednesday, followed by a press conference at 2:30 p.m. ET.