Tech Stocks Remain Under Pressure as U.S. Markets Extend Losses into Tuesday's Close

U.S. stock indices extended their declines into Tuesday's close, with technology stocks under pressure. The market saw profit-taking following a recent strong rally, compounded by rising U.S. Treasury yields and elevated oil prices, intensifying investor concerns over inflation and borrowing cost prospects.

Major Indices in the Red As of the closing session, the Dow Jones Industrial Average fell 0.34% to 49,517.62 points; the Nasdaq Composite declined 0.54% to 25,948.77 points; and the S&P 500 dropped 0.37% to 7,375.92 points. The S&P 500 and Nasdaq were on track for a second consecutive day of losses, reflecting a shift towards caution in market sentiment.

Chip Stocks Lead Declines, Nvidia Under Pressure Ahead of Earnings The Philadelphia Semiconductor Index fell approximately 6% over two days, as investors opted to take profits amid concerns over stretched valuations and the sustainability of data center spending. Nvidia's stock continued its decline for a third consecutive session, falling about 1.3% to $222.32 near the close. The market is highly focused on the company's earnings report scheduled for release after the close on Wednesday, with expectations that the results will serve as a key short-term catalyst for the AI sector.

Micron Technology dropped nearly 6%, and Seagate Technology plunged about 7%, primarily after their management warned that capacity expansion was struggling to keep pace with demand, sparking investor concerns about supply bottlenecks in the memory chip industry.

Analyst: Pullback Seen as a "Well-Deserved Pause" Jed Ellerbroek, Portfolio Manager at Argent Capital Management, stated that the current pullback is "a well-deserved pause after an epic run," noting that "it's interesting to see a reversal just days before the world's largest chip stock is set to report excellent earnings and guidance." Additionally, strategists at Citadel Securities warned that the 30-year U.S. Treasury yield hovering near a three-year high is eroding the appeal of equity assets, with market momentum gradually weakening.