Major US stock indexes experienced mixed results on Tuesday as investors prepared for upcoming tech earnings and the Federal Reserve's interest rate announcement. The S&P 500 ended higher, gaining 0.23% to 7,430.25 points according to preliminary data, while another report indicated a rise of 0.2% to 7,428.78 points. The Dow Jones Industrial Average saw significant gains, rising 1.05% to 52,756.69 points, or 1% to 52,747.32. In contrast, the Nasdaq Composite, heavily weighted with tech stocks, dropped 0.24% to 24,873.20 points, or 0.2% to 24,876.91.
The S&P 500's performance was bolstered by strong showings from non-tech companies like Boeing, which jumped 4.8% after generating positive free cash flow, and Coca-Cola, which rallied 5% after raising its annual revenue and profit forecasts. These gains helped to counter a decline in chip stocks ahead of quarterly reports from major tech companies such as Apple, Amazon, Microsoft, and Meta Platforms. Microsoft rose 1.1% and Apple climbed almost 1% to $340.08, briefly hitting a market value of $5 trillion for the first time.
Investors are closely monitoring the Federal Reserve's interest rate decision, expected on Wednesday. Traders, using CME's FedWatch tool, assigned a 71% probability to the central bank leaving rates unchanged and a 29% chance of a 25-basis-point rate hike. Concerns remain that higher interest rates could further pressure AI companies, which are increasingly reliant on debt financing. Oil prices provided some relief, with Brent falling 4.8% to $84.09 a barrel, easing inflation worries and contributing to lower bond yields.
Sector performance varied, with the S&P 500 healthcare index jumping 2.4%, the consumer staples index adding 2%, and the materials index rising 1.7%. However, the tech index declined by 1.4% due to the struggling chipmakers. Corning tumbled 12% after its third-quarter sales forecasts missed estimates, while IQVIA Holdings jumped 14% after lifting its annual profit forecast. Overall, advancing issues outnumbered falling ones within the S&P 500 by a 2.5-to-one ratio.
