Markets paused briefly on Tuesday as trading resumed following the record highs reached by major U.S. indices after the election. Stocks saw modest declines, with the Dow Jones Industrial Average falling by 272 points, or 0.6%, the S&P 500 slipping 0.3%, and the Nasdaq Composite dropping 0.2%. Meanwhile, Treasury yields rose, with the 10-year rate climbing by approximately ten basis points.
Among individual stocks, Nvidia (NVDA, Financial) saw a more than 2% rise due to strong sentiment surrounding Artificial Intelligence, while Tesla (TSLA, Financial) lost nearly 5%, reversing part of its post-election rally.
Despite the pullback, confidence remains high after Monday's milestones, where the Dow closed above 44,000 and the S&P 500 exceeded 6,000 for the first time. Investors continue to focus on expectations that a potential return of Donald Trump to the presidency could lead to reduced corporate taxes and eased regulations.
Dave Sekera, Chief U.S. Market Strategist at Morningstar, noted that investors are considering the likelihood of an extended corporate tax cut and possible additional tax reductions. These expectations, along with last week's Federal Reserve interest rate cut, have fueled optimism in the market.
