Traders work on the floor of the New York Stock Exchange.
NYSE
The Dow Jones Industrial Average rose to a record high on Tuesday, boosted by old economy stocks as oil prices moved lower, while chipmakers bogged down the Nasdaq Composite.
The 30-stock index was up 477 points, or 0.9%. It scored a new all-time intraday high in the session. The S&P 500 fell 0.1%, while the Nasdaq Composite pulled back 0.5%.
Pulling down the tech-heavy Nasdaq, a number of chip stocks suffered losses Tuesday. Advanced Micro Devices dropped more than 4%, while Broadcom and Micron Technology shed more than 3% each. Nvidia lost more than 1%.
Elsewhere, oil prices extended their drop from the prior trading day. Brent crude futures fell 5% to dip below $80 per barrel — the first time since March. U.S. West Texas Intermediate futures declined 5% to around $75 a barrel.
As oil dipped further, shares of Caterpillar led industrials higher, while JPMorgan Chase was a leader among banks higher as investors bet that lower energy prices will spur a re-acceleration in the U.S. economy. Caterpillar was up more than 2%, while JPMorgan advanced more than 3%.
SpaceX also continued to be a standout with its 10% pop, a move that added to its sharp gains since going public last week. With its gains, SpaceX had at one point surpassed both Microsoft and Amazon in market cap during the session. The company priced its initial public offering at $135. It last traded around $212.
The major averages are building on a winning session from Monday, when the Dow surged more than 400 points to a record. The S&P 500 and Nasdaq likewise posted sharp gains after President Donald Trump announced that the U.S. and Iran had reached a deal to end the war in the Middle East.
Pakistani Prime Minister Shehbaz Sharif said that both sides have declared the termination of their military operations on all fronts, with an official signing ceremony to take place this Friday in Switzerland. A senior Trump administration official told CNBC’s Megan Cassella that the memorandum of understanding was already signed electronically on Sunday.
The president also said that the key Strait of Hormuz passageway would reopen on Friday, sending oil prices down nearly 5% on Monday. He later clarified Tuesday that the strait will remain toll free beyond the initial 60-day period.
“We’re not out of the woods yet,” said Andy Goldberg, chief investment strategist at Nomura Asset Management International.
“If all of a sudden oil prices were to come down quickly, the headline inflation number will come down, but at the same time, it’ll put a lot of money back in consumers’ pockets right at a time where they’re feeling pretty good, and that’s how you can get some more inflation,” he added. “Warsh has a balancing act on his hands.”
