US sharemarkets finished mixed on Tuesday as investors rotated out of semiconductor stocks and into cyclical sectors expected to benefit from lower oil prices and an improving economic outlook.
The Dow Jones Industrial Average rose 328.64 points, or 0.64%, to a record close of 51,999.67 after reaching a new intraday high of 52,190.29. The S&P 500 fell 0.57% to 7,511.35, while the Nasdaq Composite declined 1.15% to 26,376.34.
Technology stocks weighed heavily on the broader market, with semiconductor names extending their recent pullback.
The weakness in chipmakers followed a strong rally over recent months as investors reassessed valuations across the artificial intelligence sector.
In contrast, cyclical sectors benefited from the continued decline in energy prices. Caterpillar gained more than 1%, while JPMorgan Chase rose over 3% as investors increased exposure to industrial and financial stocks that could benefit from lower inflation and stronger economic activity.
SpaceX remained a major focus for markets. Shares climbed almost 5% on their third day of trading, extending gains since last week’s IPO. The company closed at US$201.80 and briefly surpassed both Amazon and Microsoft during the session to become one of the world’s most valuable listed companies.
Australian Market Outlook
Australian shares are expected to open slightly lower after weakness across US technology stocks offset gains in cyclical sectors on Wall Street.
S&P/ASX 200 futures are down 21 points, or 0.24%, to 8,904.
Technology stocks may remain under pressure locally following the sell-off across major semiconductor companies overnight, while financial and industrial sectors could find support from lower oil prices and easing inflation expectations.
Investors will continue assessing the implications of the Reserve Bank of Australia’s latest policy decision after Governor Michele Bullock left interest rates unchanged. Markets are increasingly pricing in the possibility of rate cuts over the coming months.
On the economic front, the Westpac-Melbourne Institute Leading Index for May will be released today, while New Zealand will report first-quarter current account data.
