Stock Market Today, July 29: Stocks Slide on Hawkish Fed and Increased Middle East Tensions
The Dow Jones Industrial Average (DJINDICES:^DJI) fell 2.19% to 51,594, while the S&P 500 (SNPINDEX:^GSPC) lost 1.52% to 7,316 and the Nasdaq Composite (NASDAQINDEX:^IXIC) dropped 1.74% to 24,443 as a hawkish Federal Reserve and geopolitical tensions in the Middle East pressured equities.
Gold gained 0.27% to $4,048.99 as of U.S. market close, and the 10-Year Treasury yield gained 0.09% to 4.70%. Energy and consumer defensive stocks were among the few gainers, while industrials fell 3.42% and technology stocks dropped 2.36%.
Today's biggest moves
Exxon Mobil Corp and Chevron Corp rose as oil prices jumped following a surprise escalation of tensions in the Middle East. Caterpillar Inc tumbled 6.91% after an analyst downgrade. Deere & Co also dropped 4.52% amid falling agricultural commodity prices and cautious guidance. Meta Platforms and Microsoft both reported after the bell.
What this means for investors
The Federal Reserve held interest rates steady today, as had been expected, but stocks fell as traders digested the news that three officials had voted for a rate hike. A re-escalation of U.S.-Iran tensions and subsequent jump in oil prices added to the pressure on equities.
Semiconductor stocks felt the strain as the South Korean Kospi Index dropped 6%, pulling the Nasdaq 100, which has fallen 10% from its June high, into correction territory. Micron Technology and Sandisk both tumbled as AI jitters spread.
News that Berkshire Hathaway reached a record cash position of $397 billion offered another reason for caution. That eye-watering war chest has fueled speculation that the firm Warren Buffett transformed may be readying for a downturn.
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Emma Newbery has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Berkshire Hathaway, Caterpillar, Chevron, Deere & Company , Meta Platforms, Micron Technology, and Microsoft. The Motley Fool has a disclosure policy.
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