Tech Pullback Weighs on S&P 500 and Nasdaq as Dow Extends Record Run

Stocks turned in a relatively quiet session following Monday’s strong rally, with a pullback in technology shares pressuring the broader market while falling oil prices continued to support economically sensitive sectors. The Dow Jones Industrial Average gained 0.6% and extended its advance to fresh record territory, while the S&P 500 slipped 0.6% and the Nasdaq Composite fell 1.2%.

Technology stocks led the retreat after spearheading the previous session’s rally. The information technology sector dropped 2.3%, making it the worst-performing sector by a wide margin. Semiconductor shares bore the brunt of the selling, as investors took profits following Monday’s surge. The Philadelphia Semiconductor Index declined 5.7%, surrendering all of its prior-day gains.

Among the notable laggards, Lumentum and Monolithic Power Systems posted steep losses, while NVIDIA declined 2.4% and weighed on both the semiconductor group and the broader mega-cap complex. The weakness across large technology names pushed the Vanguard Mega Cap Growth ETF down 1.1%.

Despite the pressure on technology stocks, market sentiment remained relatively constructive. SpaceX continued to attract investor interest following its recent IPO, extending its impressive post-debut rally. Although the stock gave back much of an early advance during the afternoon, buyers reemerged into the close, allowing shares to finish nearly 5% higher.

Outside of technology, falling energy prices provided a supportive backdrop for much of the market. Investors remained optimistic that Friday’s scheduled signing of the U.S.-Iran peace agreement could lead to a lasting reduction in geopolitical tensions and help keep energy costs contained. WTI crude oil futures fell 6.0%, settling at $76.06 per barrel.

The continued decline in oil prices weighed on the energy sector, which fell 0.4%, making it the only other sector to post a loss greater than 0.1%.

Elsewhere, seven of the eleven S&P 500 sectors finished higher. Financials led the advance with a 1.5% gain as lower oil prices eased economic growth concerns and supported bank stocks. JPMorgan Chase was the standout performer in the Dow after reports indicated that JPMorgan and Morgan Stanley had been selected to lead a potential $2 billion IPO of L3Harris Technologies’ missile unit, Axyv.

Cyclical sectors also benefited from the improving macro backdrop. Industrials gained 0.7% as most constituents finished higher, while the materials sector rose 0.5%, supported by continued strength in construction-materials companies and lower Treasury yields.

Small- and mid-cap stocks were unable to maintain momentum, however. The Russell 2000 declined 0.9%, while the S&P MidCap 400 lost 0.3%.

Corporate news was relatively light, though several individual names attracted attention. Moderna jumped 6.3% after providing encouraging updates on its product pipeline and commercialization strategy. CoreWeave climbed nearly 10% after announcing that it achieved the fastest DeepSeek-V3 671B training performance in benchmark testing.

Overall, the session appeared more like a pause in the recent technology-driven rally than a meaningful shift in market sentiment. Profit-taking across semiconductors and mega-cap technology names weighed on the major indices, but declining oil prices continued to encourage rotation into other sectors and helped maintain a constructive tone beneath the surface.

Investor attention now shifts to tomorrow’s FOMC meeting. While the Federal Reserve is widely expected to leave interest rates unchanged, market participants will be closely focused on the first meeting under Fed Chair Kevin Warsh for clues regarding the future policy path and the Committee’s assessment of recent improvements in inflation and energy prices.

Our FTinvest 11 model portfolio declined 1.01% to close at 978.00, giving back the gains from the previous session and extending the recent period of volatility. The portfolio remains below the 1,000 level and continues to trade well below its all-time high of 1,078.93, reflecting the ongoing impact of weakness in one portfolio component facing liquidity-related challenges.

FTinvest 11 remains up approximately +5.37% year-to-date. Despite the recent pullback, the portfolio continues to hold a positive return for 2026 and remains positioned around a disciplined, value-driven investment philosophy. While short-term sentiment remains cautious, the broader portfolio has demonstrated resilience through previous periods of market turbulence and continues to focus on long-term capital appreciation.