Closing Summary
U.S. equities ended Tuesday's session with a split tape: the Nasdaq Composite advanced on strength in AI semiconductors and materials, while the Dow Jones Industrial Average and S&P 500 slipped as financials and energy weighed. The market's risk appetite stayed intact despite the Federal Reserve's first rate hike since 2023 delivered the previous week, with investors treating the move as a policy normalization step rather than a growth threat. Volatility continued to compress, and the day's biggest single catalyst arrived after the bell, when Nvidia's quarterly results and forward guidance eased concerns that AI capital spending is losing momentum.
Indexes
The Dow Jones Industrial Average fell 0.36% to 51,863.69.
The S&P 500 Index fell 0.01% to 7,764.27.
The Nasdaq Composite advanced 0.45% to 27,244.28.
The Cboe Volatility Index fell 4.03% to 14.27 at Tuesday's close, its lowest level in several weeks, signaling complacency around near-term drawdown risk. SPY and QQQ turnover was moderate, with QQQ volume outpacing SPY on a percentage basis, consistent with the day's growth-led leadership.
Stock & Sector Performance
Eleven S&P 500 sectors finished mixed. Materials led gainers, with the Materials Select Sector SPDR Fund (XLB) rising 1.65%, followed by Consumer Staples (XLP, +0.99%) and Technology (XLK, +0.72%). Industrials (XLI, +0.17%) and Consumer Discretionary (XLY, +0.09%) eked out small gains. On the downside, Financials (XLF, -1.99%) was the weakest sector as the group gave back part of its post-rate-hike rally; Energy (XLE, -1.09%) and Communication Services (XLC, -1.06%) also declined, while Utilities (XLU, -0.33%) and Real Estate (XLRE, -0.21%) slipped modestly.
The Magnificent Seven finished mixed. Tesla (TSLA) gained 0.96% and Apple (AAPL) added 0.23%, while Nvidia (NVDA) rose 0.66% ahead of its after-hours report. Decliners included Amazon.com (AMZN, -1.34%), Alphabet (GOOGL, -1.07%), Microsoft (MSFT, -0.72%), and Meta Platforms (META, -0.63%). The divergent performance within mega-cap tech underscored that today's moves were stock-specific rather than a uniform sector rotation.
Major Company News
Nvidia dominated after-hours attention. The company reported fiscal second-quarter revenue of $96.2 billion, up 18% sequentially and 106% year over year, with GAAP and non-GAAP gross margins of 75.0%. Non-GAAP earnings per diluted share came in at $2.22, above the $2.10 consensus. Management's forward guidance pointed to continued AI infrastructure demand, and shares moved higher in extended trading. The report helped validate the AI capital-expenditure thesis that has underpinned the semiconductor complex, and it offset some of the pressure that weighed on other mega-cap tech names during the regular session.
No other single company story moved the broad tape on Tuesday; outside of Nvidia's post-close release, the day's moves were sector-wide rather than idiosyncratic.
