Stocks edged lower Tuesday as a sell-off that has engulfed Wall Street in recent weeks resumed after two straight winning sessions.
The Dow Jones Industrial Average
lost 299 points, or 0.7%. The S&P 500
shed 1.2%, nearing correction territory; it traded nearly 9% below its record. The Nasdaq Composite
dropped 8%.
Tesla
, one of the stocks hardest hit during the market’s recent correction, was down yet again on Tuesday. The stock fell 4% after RBC Capital Markets lowered its price target on the electric vehicle name, citing rising competition in the EV space. It has decreased by 35% in the past month. During the session, the EV manufacturer was not the only tech name present. Shares of Palantir
and Nvidia
dropped more than 3% and 2%, respectively. The Technology Select Sector SPDR Fund (XLK)
was also down more than 1%.
Wayve Capital's chief investment officer, Rhys Williams, stated, "It does appear the market really does want to rotate into things that haven't worked as well, out of things that did work well for the last couple of years, so that may be just what all this is about." “The markets are going to remain choppy up until whatever decision is made on April 2,” Williams also said, referring to President Donald Trump’s impending tariff exemption deadline on some imports from Canada and Mexico.
The declines come after Wall Street's second consecutive winning session. That marks a turn after several tough weeks on Wall Street as some soft economic data and Trump’s on-again-off-again tariff policy left investors wary of the U.S.′ financial health.
The S&P 500
officially entered correction territory last week, but the index has made up some notable ground in the recovery rally seen in Friday’s and Monday’s sessions. Despite the recent bounce, the tech-heavy Nasdaq still sits in a correction, a term used to describe an index falling at least 10% from a recent high. The three major averages all remain down on the year, underscoring the strength of the market’s pullback.
While investors continue to follow updates out of the White House, they’ll turn their attention to the Federal Reserve two-day policy meeting that kicks off Tuesday.
Traders will closely follow Wednesday afternoon’s interest rate announcement and subsequent press conference with Fed Chair Jerome Powell. CME's FedWatch tool shows that Fed funds futures are pricing in a 99 percent chance that the central bank will keep rates the same.