NASDAQ Index, SP500, Dow Jones Forecasts – Six-Week Surge Stalls as Traders Watch for Catalyst to Extend Gains

Dow eases as defensive gains fail to offset broader weakness

The Dow Jones Industrial Average slipped 138 points, or 0.32%, on Tuesday, closing at 42,747. Defensive names including UnitedHealth (+1.8%) and Merck (+0.96%) offered modest support, but were not enough to counter declines in industrials and financials. American Express fell over 1%, while Goldman Sachs lost 0.94%, dragging the financial sector lower. Weakness in Chevron (-0.88%) added pressure as oil prices softened.

From a technical view, the Dow continues to trade below its February highs but has reclaimed its 50-day simple moving average, now acting as support around 41,175. However, momentum indicators suggest overbought conditions may be setting in. The index remains roughly 1.5% below the March peak, indicating potential resistance in the 43,500 range. Traders may tread cautiously ahead of Friday’s durable goods report and further clarity on tax reform progress.

S&P 500 ends win streak as tech drags on performance

The S&P 500 dipped 0.39% to 5,940.46, snapping a six-day winning streak. The selloff was led by technology stocks, which fell 0.45%. Heavyweights including Nvidia (-0.9%), Apple (-0.92%), and Microsoft (-0.15%) all closed lower. Despite the dip, the index is still up more than 20% from its April lows, driven largely by optimism around reduced tariff risks and stabilizing macroeconomic data.

Health care offered a bright spot, with names like Regeneron (+3.2%) and Gilead (+2.8%) supporting gains. The sector rose 0.27%, as investors rotated into more defensive areas. Technically, the index remains well above its 50-day SMA near 5,597, suggesting underlying strength. With the index only 3% off all-time highs, consolidation at current levels could set the stage for another breakout if upcoming inflation data confirms cooling price pressures.

Nasdaq 100 slips as tech enthusiasm fades

The Nasdaq 100 declined 0.48% to 21,423 as the recent surge in tech cooled. High-beta names like Super Micro Computer (-4.5%), Airbnb (-3.2%), and Amazon (-1.01%) dragged on the index. Nvidia, which has been a key driver of the recent rally, also lost ground. Despite the pullback, the index has posted a strong recovery, now trading more than 10% above its 50-day SMA, which sits at 19,626.

Momentum remains constructive, but the pace of gains has left the index technically stretched. RSI levels are hovering near overbought territory, suggesting some near-term consolidation is likely. Sector leadership remains tied to the trajectory of interest rates and AI-related sentiment. Traders will be closely watching the upcoming Fed minutes release and Friday’s core PCE inflation report for guidance on rate expectations.

More Information in our Economic Calendar.