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The Dow fell by 165 points on Tuesday morning as gold prices surged to another record high and interest rates continued to climb.
Federal Reserve policymakers are considering a more moderate approach to future interest rate cuts, a shift that has dampened investor sentiment. The prospect of slower rate reductions suggests that the Fed remains cautious about balancing inflation control with economic growth, contributing to the broader market’s unease.
Shortly after the market opened Tuesday, the Dow Jones Industrial Average dropped 165 points, or 0.3%. The tech-heavy Nasdaq and S&P 500 shed 0.3% and 0.4%, respectively.
Spot gold prices have surged past $2,700 an ounce, reaching a new record high of $2,733. This marks a significant milestone for the precious metal, which has gained more than 30% year-to-date, driven by heightened investor demand for safe-haven assets amid ongoing economic uncertainties and tension in the Middle East.
Meanwhile, the yield on the 10-year U.S. Treasury briefly climbed above 4.2%—its highest level since July—before pulling back slightly. The rise in bond yields reflects concerns over persistent inflation and the potential for further tightening by the Federal Reserve, which has kept pressure on equity markets.
Stocks to watch today
Several major companies are reporting earnings on Tuesday, including 3M (MMM-2.36%), General Motors (GM-2.38%), GE Aerospace (GE-2.88%), and Verizon Communications (VZ+1.06%), all of which drew significant attention from investors.
Nvidia (NVDA-1.69%), which hit another high on Monday, was down 0.6% Tuesday morning, while Tesla (TSLA-4.21%), which reports earnings on Wednesday, was down 0.8%.