Investors rotated out of technology shares on Thursday, lifting the Dow Jones Industrial Average while dragging down the Nasdaq Composite. The Russell 2000 climbed 1.1%, marking its first record close since Dec. 11.
Gains in non-tech names such as Home Depot, American Express, and Caterpillar pushed the Dow up 270 points, or 0.6%. Meanwhile, losses in Nvidia and Broadcom weighed on the Nasdaq, which fell 0.4%, while the S&P 500 ended the session nearly unchanged.
Defense stocks rebounded after President Trump called for a $1.5 trillion military budget—more than $500 billion above what the Pentagon is expected to receive this fiscal year. The sector had recently faced pressure after Trump ordered limits on shareholder payouts.
In the bond market, Treasury yields rose after weekly jobless claims came in slightly below expectations. Yields were also supported by a sharp decline in October’s trade deficit, which fell to $29.4 billion, the lowest level since 2009. The 10-year Treasury yield settled at 4.182%.
Oil prices moved higher, with Brent crude futures gaining 3.4% to $61.99 a barrel. The Wall Street Journal reported that the White House is considering long-term plans to dominate Venezuela’s oil industry, a move Trump believes could eventually drive prices down to $50 a barrel.
In Asia, stocks in Japan and Hong Kong fell more than 1%, as China moved to restrict rare-earth exports to Japan in response to remarks by Japanese leaders regarding Taiwan.
Frequently Asked Questions
Why did the Dow rise while the Nasdaq fell?
Investors shifted money out of technology stocks into industrial, financial, and defensive names, lifting the Dow while weighing on the tech-heavy Nasdaq.
What drove the rally in small-cap stocks?
The Russell 2000 gained as investors sought value outside mega-cap tech, helping the index reach its first record since December.
Why did defense stocks jump?
Defense shares rebounded after President Trump proposed a $1.5 trillion military budget, signaling higher government spending despite earlier limits on shareholder payouts.
What pushed Treasury yields higher?
Yields rose after jobless claims came in slightly below expectations and the U.S. trade deficit dropped sharply, pointing to economic resilience.
Why did oil prices move up despite talk of lower future prices?
Crude prices climbed on geopolitical developments, including reports of U.S. plans related to Venezuela’s oil industry, even as longer-term expectations suggest potential price pressure.
