U.S. Stocks Rise After Volatile Session as Investors Seek Direction
U.S. stocks traded higher on Tuesday following a volatile session that saw major indexes swing between losses and gains. Investors returned from the long weekend searching for direction in uncertain market conditions.
At 14:27 ET (20:27 GMT), the S&P 500 advanced 0.3% to 6,856.93 after earlier dropping as much as 0.9%. The Nasdaq Composite gained 0.4% to 22,640.14, recovering from a decline of 1.3%. Meanwhile, the Dow Jones Industrial Average climbed 0.2% to 49,603.64.
AI Disruption Concerns Weigh on Markets
Artificial intelligence disruption remained a central theme on Wall Street.
Stocks opened mixed before quickly sliding to session lows. However, the market rebounded around midday and later pushed into positive territory.
Michael O’Rourke, chief market strategist at Jones Trading, noted early weakness in AI-related stocks. A rebound in major technology names such as NVIDIA, Broadcom, and Apple helped lift the broader indexes.
Despite the recovery, some AI-related software companies continued to struggle. Sector rotation also influenced trading, as gains in financial stocks offset profit-taking in retail giants like Walmart and Home Depot.
Wall Street was closed Monday for Presidents’ Day, but markets are coming off a negative week driven by growing concerns about new AI models and their potential disruption across industries.
Analysts at Deutsche Bank said investor focus has shifted back to artificial intelligence after earlier attention on geopolitical risks. They added that the market is now assessing which sectors may benefit from AI and which could face disruption.
Fed Minutes and Key U.S. Data in Focus
Investors are closely watching a packed economic calendar this week for clues about interest rate policy.
The Federal Reserve will release minutes from its January meeting on Wednesday. The central bank held rates steady at that meeting, and traders are eager for insights into future rate decisions.
Industrial production and durable goods data are also due Wednesday, while December trade figures will be released Thursday.
On Friday, markets will receive the Personal Consumption Expenditures (PCE) price index — the Fed’s preferred inflation gauge — along with the preliminary estimate of fourth-quarter GDP growth.
Last week’s consumer price index (CPI) report showed modest cooling in headline inflation, while core inflation eased slightly in line with expectations.
Corporate Earnings in the Spotlight
Corporate earnings remain another key driver of market sentiment.
Palo Alto Networks is scheduled to report quarterly results after the close. Investors will be watching closely for updates on the cybersecurity firm’s AI strategy and demand trends.
The company previously raised its full-year revenue and profit outlook, citing strong demand for digital security solutions. It also announced a $3.35 billion acquisition of cloud monitoring company Chronosphere, which will be integrated into its Cortex AgentiX platform to enhance AI capabilities.
Other companies reporting later this week include DoorDash, Walmart, and Wayfair.
Oil Prices Fall on U.S.-Iran Deal Hopes
Brent crude prices declined after reports that the United States and Iran made progress in nuclear talks held in Geneva.
According to Bloomberg, Iran’s foreign minister said the two sides reached a general agreement on guiding principles toward a potential deal.
Brent crude futures for April delivery fell 1.9% to $67.32 per barrel. West Texas Intermediate (WTI) crude slipped 0.9% to $62.16 per barrel.
The talks come amid elevated tensions in the Middle East, where the U.S. has increased its military presence. President Donald Trump has previously warned of potential military action if Iran does not accept a deal.
With geopolitical developments and key economic data ahead, markets remain highly sensitive to new headlines and policy signals.
