U.S. stock markets recovered on Tuesday, posting strong gains after sharp losses in the previous session. The rebound was largely driven by strength in technology shares, particularly semiconductor companies.
The S&P 500 rose 0.8% to close at 6,891.04, while the NASDAQ Composite gained 1.1% to finish at 22,863.68. The Dow Jones Industrial Average also climbed 0.8% to 49,174.81. These gains followed notable declines the day before, when investor concerns about global trade policies and artificial intelligence disruptions weighed heavily on markets.
Investors are also closely watching political developments, including the president’s State of the Union address, which could provide further clarity on economic and trade policies.
AI and Trade Uncertainty Continue to Influence Markets
Recent market volatility has been fueled in part by a research report outlining a hypothetical scenario in which rapid AI adoption could disrupt employment, reduce consumer spending, and slow economic growth. This contributed to sharp swings in stock prices as investors reassessed risks and opportunities across sectors.
Trade tensions also remain a key concern. New tariffs on imports took effect at a 10% rate, although officials are considering raising them further. Ongoing legal disputes and policy uncertainty have left companies and investors unsure about the future direction of trade regulations.
A major logistics company has filed a lawsuit seeking refunds for tariffs paid previously, becoming one of the first firms to challenge the policy following the recent court ruling.
Retail and Technology Stocks Show Strength
Retail stocks performed well after a major home improvement retailer reported better-than-expected sales, supported by higher prices and strong demand from professional contractors. The company’s shares rose following the positive results.
Technology stocks also rebounded after recent declines. Semiconductor companies gained momentum after announcing new partnerships related to artificial intelligence infrastructure. Software firms also advanced after announcing AI-related business deals.
Investors are now focused on upcoming earnings reports from a leading AI chipmaker, which is expected to provide key insights into demand for artificial intelligence technologies.
Oil Prices Remain Elevated Amid Geopolitical Developments
Oil prices fluctuated but remained near multi-month highs as investors monitored ongoing diplomatic talks between the United States and Iran. The discussions are aimed at reducing tensions and addressing concerns about nuclear development, which could influence global oil supply and prices.
