Stocks Decrease Following Winning Streak Interruption; Palantir Plunges After Earnings Release; Investors on Edge for Tariff Updates, Federal Decision News
Stock markets took a slight dip in afternoon trading Tuesday as investors reacted to a steady stream of earnings reports while awaiting updates on tariffs and the results of the two-day Federal Reserve meeting. The S&P 500 and the Dow Jones Industrial Average were down 0.3% and 0.2%, respectively, while the Nasdaq Composite declined 0.4%.
Stocks fell Monday, snapping a nine-session winning streak for the S&P 500, the longest in two decades. Over the past two weeks, stocks have recovered from the losses that followed President Trump's early-April announcement of plans to impose hefty tariffs on leading trading partners, notably China. Investors have grown optimistic that the White House will negotiate deals that will result in lower rates than Trump initially proposed, though the uncertainty about trade policy has spurred concerns about the outlook for the economy and corporate profits.
Investors will be paying close attention to the Fed's comments on the impact of tariffs on the economy and interest rates. The central bank is not expected to adjust its benchmark rate this week, but market participants are eager to hear from Fed Chair Jerome Powell, who will speak Wednesday afternoon following the policy committee meeting, about the outlook.
Shares of companies reporting quarterly results were among the notable movers Tuesday. Palantir, the AI software maker, saw its shares plummet 13% despite reporting first-quarter earnings that were in line with Wall Street estimates and issuing a rosy outlook. Constellation Energy, another AI investor favorite, jumped 11% after reporting higher-than-expected revenue due to booming demand to power AI products and services.
Ford Motor shares climbed 3% after the automaker reported first-quarter earnings that topped analysts' expectations but suspended its full-year forecast amid uncertainty about tariffs. Mattel, the toy maker, rose 4% after it suspended its guidance and said it would raise prices in response to the tariffs.
Mega-cap technology stocks, which had powered the recent rally, were under pressure on Tuesday, led by a decline of nearly 3% for Tesla. Nvidia, Meta Platforms, Microsoft, Alphabet, and Broadcom also retraced. However, Apple and Amazon inched higher.
Shares of Newmont Mining, the world's largest gold miner, rose more than 1%, adding to yesterday's gains, as the price of gold continued to rise. Gold futures were up 2.4% at $3,405 an ounce in recent trading. Crude oil futures rebounded from steep declines yesterday, with West Texas Intermediate futures up 4.3% to $59.60 per barrel this morning after hitting a four-year low on Monday. Energy and utilities were the only sectors gaining ground in the S&P 500 on Tuesday.
The yield on the 10-year Treasury note was at 4.35% recently, up slightly from yesterday's close. The U.S. dollar index fell 0.4% to 99.42. Bitcoin was at $94,400, up from an earlier low of $93,400. The digital currency was trading as high as $98,000 on Friday.
Constellation Energy Soars as AI Demand Boosts Revenue
Constellation Energy shares soared Tuesday as the nuclear power utility beat operating revenue forecasts and kept its 2025 outlook steady despite weaker-than-expected profit, as it continued to benefit from AI-related electricity demand. The company reported first-quarter operating revenue rose more than 10% year-over-year to $6.79 billion, while analysts at Visible Alpha were looking for $5.44 billion. Shares of Constellation Energy are up about 23% since the start of the year and nearly doubled in 2024, making it one of the top performers in the S&P 500.
- Amid the recovery from losses incurred after President Trump's tariff announcement, investors are waiting for updates on tariffs and Fed comments on their potential impact on the economy and interest rates.
- The price of gold continues to rise, causing shares of Newmont Mining, the world's largest gold miner, to increase.
- In the realm of digital currency, Bitcoin was at $94,400, rebounding from an earlier low, with tech companies like Tesla facing pressure in the stock market.
- Constellation Energy, an AI investor favorite, saw a significant surge in its shares after reporting higher-than-expected revenue due to strong AI-related electricity demand.
- The cryptocurrency market is demonstrating a technical analysis lemon, with Bitcoin showing signs of recovery after a dip, despite predictions of lower tariff rates by investors. This surge might influence Bitcoin's role in shaping people's lifestyles and the broader technological landscape.
