Nasdaq Reaches Record Closing High But Dow, S&P 500 Move Lower

(RTTNews) - Stocks moved mostly higher early in the session on Tuesday but gave back ground over the course of the trading day. The major averages pulled back well off their highs of the session before eventually closing mixed.

While the tech-heavy Nasdaq rose 37.47 points or 0.2 percent to a new record closing high of 20,677.80, the S&P 500 fell 24.80 points or 0.4 percent to 6,243.76 and the Dow slumped 436.36 points or 1.0 percent to 44,023.29.

The uptick by the Nasdaq came amid strength in the semiconductor stocks, as reflected by the 1.3 percent gain posted by the Philadelphia Semiconductor Index. The index ended the session at its best closing level in a year.

Nvidia (NVDA) helped lead the sector higher, with the AI darling surging by 4.0 percent to a record closing high after indicating it will "soon" resume H20 AI chip sales to China.

"The U.S. government has assured NVIDIA that licenses will be granted, and NVIDIA hopes to start deliveries soon," the company said in a statement.

On the other hand, housing stocks moved sharply lower over the course of the session, resulting in a 3.3 percent plunge by the Philadelphia Housing Sector Index.

Oil service stocks also slumped amid a decrease by the price of crude oil, dragging the Philadelphia Oil Service Index down by 3.1 percent.

Banking, pharmaceutical and biotechnology stocks also saw considerable weakness, contributing to the pullback by the broader markets.

Earlier in the day, stocks responded positively to a Labor Department report showing consumer prices in the U.S. increased in line with economist estimates in the month of June.

The Labor Department said its consumer price index rose by 0.3 percent in June after inching up by 0.1 percent in May.

The annual rate of consumer price growth accelerated to 2.7 percent in June from 2.4 percent in July. Economists had expected the price of growth to rise to 2.6 percent.

The Labor Department also said the core consumer price index, which excludes food and energy prices, edged up by 0.2 percent in June after creeping up by 0.1 percent in May. Core prices were expected to increase by 0.3 percent.

Buying interest waned over the course of the session, however, with concerns about President Donald Trump's trade wars still hanging over the markets.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Tuesday. Japan's Nikkei 225 Index climbed by 0.6 percent and Hong Kong's Hang Seng Index jumped by 1.6 percent, although China's Shanghai Composite Index bucked the uptrend and fell by 0.4 percent.

Meanwhile, the major European markets moved to the downside over the course of the session. While the U.K.'s FTSE 100 Index slid by 0.7 percent, the French CAC 40 Index decreased by 0.4 percent and the German DAX Index dipped by 0.4 percent.

In the bond market, treasuries saw considerable weakness following the inflation data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 6.2 basis points to a one-month closing high of 4.489 percent.

Looking Ahead

Trading on Wednesday may be impacted by reaction to reports on producer prices and industrial production along with the latest earnings news.