On Tuesday, US stocks experienced a decline, moving further away from their previous record highs amid uncertainties surrounding potential interest rate adjustments and disruptions within the “Magnificent 7” stocks, which instilled caution in the market.
Tech-heavy Nasdaq Composite contracts led the downturn, dropping approximately 1.8% as notable decreases in Apple (AAPL) and Tesla (TSLA) weighed down the broader market sentiment. Apple faced pressure following reports of a 24% decline in iPhone sales in China, compounded by Monday’s setback stemming from a €2 billion EU antitrust penalty. Meanwhile, Tesla’s woes persisted due to issues at its Berlin Gigafactory, contributing to concerns over reduced shipments and a pricing conflict in China.
The S&P 500 and the Dow Jones Industrial Average also experienced declines, dipping around 1% and 0.8%, respectively, following a negative start to the week.
Despite the market downturn, Bitcoin (BTC-USD) achieved a new all-time high, briefly surpassing its previous record set in November 2021 by reaching over $68,789. However, it subsequently retreated to trade around $65,000 per coin.
Amidst these market movements, there is ongoing debate regarding whether the recent tech-driven stock rally has peaked, as discouraging news dampens the “fear of missing out” sentiment that has kept investors engaged.
Additionally, confidence in potential easing measures by the Federal Reserve was shaken following remarks by Atlanta Fed President Raphael Bostic, who suggested only one rate cut is anticipated this year, likely in the third quarter. Investors are eagerly awaiting Federal Reserve Chair Jerome Powell’s congressional testimony for any potential shifts in the central bank’s approach to inflation and interest rates.
In corporate news, Target (TGT) surpassed Wall Street expectations with its earnings report, resulting in a more than 10% increase in share value during afternoon trading.