US stocks eased Tuesday, as investors took some time to rest after a multi-week rally.
S&P 500 fell by 0.3% while Nasdaq Composite dropped 0.4%. This was due to the weakness of technology stocks.
In choppy trading, the Dow Jones Industrial Average was hovering just below its flat line.
The technology sector led the way lower with a drop of nearly 0.9%.
Nvidia shares fell by 1%. Other tech giants such as Meta Platforms Apple and Microsoft also saw declines.
The market’s recent momentum was halted by the pullback of tech.
Home Depot broke the trend by rising 2%, after confirming its guidance for the full year.
Richard McPhail, CFO of the retailer, stated that the company does not plan to increase prices in spite of the new tariff threat.
This session came after a slight uptick Monday, which extended the S&P 500 winning streak to 6 consecutive sessions. It was its longest run since an earlier nine-day period this month.
The gains, while incremental, capped off a rapid rebound which has left the benchmark just 3% under its previous high.
The rally continues despite persistent macro-headwinds including fears over economic impact of increased tariffs and new recession worries.
Investors have also shrugged Moody’s downward revision of the US sovereign rating. This downgrade highlighted growing fiscal pressures as well as a worsening outlook for debt.
Investors “buy dips”
Investors rushed into the markets on Monday to take advantage of the record dip buying activity.
Data from JPMorgan’s trading desk shows that individual investors bought a total of $4.1 billion in equities at 12:30 PM ET, the highest intraday amount ever recorded. This was also a statistically significant move as it exceeded 11 standard deviations.
Net retail sales reached $5.4 Billion by the end of trading.
JPMorgan reported that retail traders represented 36% of the total volume on the market during this session. This is also a new record.
The aggressive purchases helped the S&P 500 index, which was down almost 1% on its lowest point, gain a small 0.09%, making it the sixth consecutive day that the index has gained.
Moody’s cut US sovereign credit ratings by a notch, from Aaa down to Aa1. The decision was based on the escalating deficits in the US and rising interest rates.
Retail buyers continue to bet on volatility despite the fact that institutional investors are becoming more cautious due to concerns about capital flight and recession risk, a result of President Donald Trump’s protectionist tariff stance.
This year, the “buy-the dip” strategy has been a favorite amongst retail investors.
They poured $40 Billion into stocks in April amid rising tariff tensions – a monthly record – demonstrating their willingness to invest despite macroeconomic uncertainties and political challenges.
The post US Stocks Slip at Open: S&P500 down 0.3%, Dow Jones Flat may be updated as new developments unfold.
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