Wall Street was split on Tuesday as optimism over a possible end to the record-breaking US government shutdown boosted blue-chip stocks, while tech shares lagged.
The Dow Jones Industrial Average surged more than 500 points, or 1.2%, leading the way as investors rotated out of pricey tech names. The S&P 500 edged up 0.3%, but the Nasdaq Composite slipped 0.1%, weighed down by renewed weakness in Nvidia and its AI peers.
SoftBank added fresh fuel to doubts about the AI trade after revealing it had sold its entire stake in Nvidia to fund its own artificial intelligence investments. The move, viewed as a sign that valuations may have run too hot, sent Nvidia shares down about 2.5%. AI infrastructure firm CoreWeave also disappointed investors, cutting its full-year revenue outlook and tumbling 15% after warning of project delays.
Still, broader market sentiment stayed positive as Washington inched closer to resolving the 41-day shutdown. The Senate passed a funding measure late Monday, sending it to the House for a potential vote this week. A reopening would allow key economic data — including inflation and employment figures – to finally be released, offering traders clearer direction on the Federal Reserve’s next move.
Meanwhile, ADP’s latest private payrolls report showed US companies shedding around 11,000 jobs a week in October, suggesting hiring is cooling even before the full impact of the shutdown is felt. On the trade front, reports that China plans to restrict rare-earth mineral exports to US military contractors revived old worries about the durability of the tariff truce.
The FTSE 100, by contrast, powered to record highs as global investors flocked to energy and bank stocks – a sign that while London’s market is basking in calm, Wall Street’s remains in two minds.
