US Stocks Mixed as Investors Focus on Fed and Trump
US stocks exhibited a mixed performance on Tuesday to initiate a holiday-shortened trading week, with the focus centered on potential policy actions by the Federal Reserve and President Donald Trump. The benchmark S&P 500 (^GSPC) advanced by nearly 0.2%, with most of the gains realized in the final 10 minutes of trading, establishing a new record closing high of 6,129.58. In contrast, the Dow Jones Industrial Average (^DJI) and Nasdaq Composite (^IXIC) finished with marginal gains.
Stock markets on Wall Street remained cautious following Monday's closure for Presidents Day as investors deliberated the future trajectory of interest rates. Over the extended weekend, Fed officials expressed a firm conviction that interest rates should remain at current levels to combat rising inflation. Treasury yields moved higher as investors sought additional cues regarding the likelihood of rate cuts this year, given that recent data had provided no clear direction. The benchmark 10-year yield (^TNX) rose to a trading level of approximately 4.54%.
This uncertainty has shifted attention to Wednesday's release of the minutes from the Fed's January meeting for further insights into policymakers' thinking amidst Trump's tariffs. Concurrently, the US-Russia negotiations aimed at resolving the Ukraine conflict are captivating markets following a meeting between Trump and Putin's teams in Saudi Arabia on Monday. Additionally, earnings season continues with results anticipated from 46 S&P 500 companies this week. Baidu's (BIDU, 9888.HK) report of a revenue decline has kickstarted imminent earnings releases from China's trillion-dollar tech sector, including Alibaba (BABA) on Thursday.
In terms of individual stock movements, Intel (INTC) emerged as a notable gainer, rising approximately 16% amid reports that competitors may pursue a deal that could lead to the chipmaker's breakup.
Additional Highlights:
* Meta's (META) stock declined throughout Tuesday, jeopardizing its 20-session winning streak on Wall Street.
* Nike (NKE) stock surged by more than 5% amid a partnership with SKIMS, which is expected to launch in the spring.
* Elon Musk's efforts to challenge Social Security have sparked concerns about data access and program stability.
* The 2025 stock market rally has witnessed a broader participation beyond the "Magnificent Seven" tech stocks.
* A strong US dollar has posed challenges for Big Tech companies with significant overseas revenue.
* Homebuilder confidence has declined to its lowest level in five months due to concerns over tariffs and high costs.
* Rivals may explore deals to carve up Intel, pushing its stock higher.
* Chip stocks and tech companies led the market at the open on Tuesday.
* Fed speakers emphasized the need for patience on interest rate cuts as inflation remains persistent.
* Europe's stock markets paused as the US and Russia commenced Ukraine talks.
* A global trade war is perceived as the primary risk to markets, according to a Bank of America survey.