NEW YORK (AP) — A rally in technology stocks on Tuesday sent the Nasdaq Composite Index to a record high, but the rest of Wall Street was trading thin as homebuilders and Ford Motor Co. fell after their latest profit reports. It was mixed.
Even though most index constituents fell on the day, the S&P 500 rose 0.2%, inching closer to its all-time high set earlier this month.
Gains in influential big tech stocks helped mask weakness in other areas, pushing the Nasdaq Composite up 0.8%, above its all-time high set in July. Meanwhile, the Dow Jones Industrial Average fell 154 points, or 0.4%.
Alphabet rose 1.8% ahead of the earnings report released after the day’s close. Google’s parent company is the newest member of a group of stocks known as the “Magnificent Seven” that release quarterly earnings, each of which will need to post strong growth to justify its lofty price.
Other market heavyweights such as Microsoft and Metaplatform were among the most powerful forces pushing the S&P 500 up.
That helped offset Ford Motor Co.’s 8.4% decline, but the company said the underlying measure of full-year profit was likely to hit the low end of its expected range. The company said that although its third-quarter results exceeded analysts’ expectations, high warranty and other costs remained a drag on profits.
Associated Press business correspondent Seth Stell reports that stocks are moving in a variety of directions.
JetBlue Airways fell 17.1% even though its latest quarter’s results beat analysts’ expectations. The company said its revenue for the final three months of 2024 could fall 3% to 7% compared to the same period last year due to this month’s Hurricane Milton and the upcoming U.S. presidential election.
DR Horton fell 7.2% after the homebuilder reported that its latest quarter’s profit and revenue fell short of analysts’ expectations. Executive chairman David Auld said some prospective homebuyers were sitting on the sidelines, waiting for mortgage rates to become more affordable.
Overall, the S&P 500 rose 9.40 points to 5,832.92. The Dow Jones Industrial Average fell 154.52 points to $42,233.05, and the Nasdaq Composite rose $145.56 to $18,712.75.
Mortgage rates have been rising recently as the yield on the 10-year US Treasury note has risen.
Yields rose as reports continued to show that the U.S. economy remained stronger than expected. A report on Tuesday said U.S. consumer confidence was much higher than economists expected, and while job openings fell slightly in September, hiring remained relatively stable.
These numbers have traders wondering how much the Fed will cut interest rates, as it is focused on keeping the economy strong as much as it is on controlling inflation. forecasts are gradually retreating. Traders are even predicting that the Fed is unlikely to keep its key interest rate unchanged at next week’s meeting, according to data from CME Group.
That comes after the Fed began its rate-cutting campaign in September with more cuts than usual. Just a month ago, many traders simply thought the Fed would cut rates further than usual in November.
Yields also rose as investors see former President Donald Trump’s re-election chances improving. Economists say Trump’s victory could contribute to higher inflation in the long run, and worsening inflation could lead to higher interest rates.
Trump Media and Technology Group, which tends to focus more on President Trump’s re-election chances than its own profit outlook, rose another 8.8% to $51.51 on Tuesday. The intraday price movements were so volatile that trading in the company’s stock was suspended several times. The parent company of President Trump’s platform Truth Social has been on the rise since bottoming out at about $12 in late September.
U.S. Treasury yields edged lower after paring gains from earlier in the day. The yield on the 10-year Treasury note fell to 4.25% from 4.28% late Monday, but is still well above the 3.60% level it hit in mid-last month. Like stocks, U.S. Treasury yields have historically tended to be volatile in the run-up to Election Day, then settle afterward, no matter which party wins.
In overseas stock markets, indexes rose in most of Asia, and then fell in Europe, with the exception of Shanghai stocks, which fell 1.1%.
Crude oil prices erased previous gains and fell, exacerbating the 6.1% plunge from the previous day. Brent crude oil, the international standard crude oil, fell 0.4%.
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AP Business writers Yuri Kageyama and Matt Ott contributed.
