Dip-Buying Keeps Dow Jones Near ATH, Suggests New Highs Next Week, Tech Stocks Falter
The Dow Jones Industrial Average closed the week near record highs, with consistent dip-buying highlighting investor confidence even as...
Quick overview
- The Dow Jones Industrial Average closed near record highs, demonstrating strong investor confidence despite pressure on tech-heavy indices.
- Nvidia's decline, triggered by competition from Alibaba's new AI chip, led to significant selling in the tech sector, particularly affecting the Nasdaq.
- In contrast, Canada's TSX Composite Index outperformed due to strength in energy and materials, reflecting the benefits of a resource-driven economy.
- Looking ahead, upcoming U.S. labor market data and Federal Reserve policy signals will be crucial in determining market direction.
Live DOW Chart
The Dow Jones Industrial Average closed the week near record highs, with consistent dip-buying highlighting investor confidence even as tech-heavy indices came under pressure.
Nvidia Decline Leads Market Selloff
The sharpest pressure came from Nvidia (NVDA), which fell more than 3% after a Wall Street Journal report revealed that Alibaba has developed a new AI chip, aiming to offset restrictions on Chinese access to U.S. semiconductors. This development rattled investor confidence, fueling heavy selling across the tech sector. The Nasdaq recorded the steepest losses of the day, while the S&P 500 also ended in the red.
The news underscores growing competition in the AI race, with Chinese firms attempting to fill the technology gap left by U.S. sanctions. Nvidia’s setback highlights both its reliance on Chinese demand and the risks of intensifying U.S.-China tech rivalry.
Dow Jones: Resilience at Record Levels
While technology stocks struggled, the Dow Jones Industrial Average showcased resilience. Dips earlier in the week were quickly bought, and Friday’s intraday pullback was erased the same day, leaving the index near its record highs. The consistent buying of dips signals strong investor confidence, with markets hinting that the Dow may set new highs next week.
This performance highlights a clear divide: value-oriented and diversified Dow stocks are holding firm, while growth-heavy indices are facing renewed pressure.
Canada’s TSX Outperforms on Resource Strength
In contrast to Wall Street’s mixed tone, the Canadian TSX Composite Index advanced both daily and weekly, buoyed by gains in energy and materials. The divergence reflects a familiar theme—Canada’s resource-driven economy is benefiting from higher commodity demand, while U.S. indices remain more sensitive to shifts in the tech sector.
Closing Levels – U.S. & Canadian Indices
Dow Jones Industrial Average (DJIA)
- Closed at 45,544.88
- Daily move: −92.02 points (−0.20%)
S&P 500 Index
- Closed at 6,460.26
- Daily move: −41.60 points (−0.64%)
Nasdaq Composite
- Closed at 21,455.55
- Daily move: −249.61 points (−1.15%)
Canada S&P/TSX Composite Index
- Closed at 28,564.45
- Daily move: +129.65 points (+0.46%)
Weekly Performance Snapshot
- Dow Jones Industrial Average: Weekly change: −60.37 points (−0.13%)
- S&P 500 Index: Weekly change: +2.59 points (+0.04%)
- Nasdaq Composite: Weekly change: −10.91 points (−0.05%)
- Canada S&P/TSX Composite Index: Weekly change: +250.80 points (+0.89%)
Macro Backdrop: Quiet Data, Market Focus Ahead
Economic data releases were relatively subdued. The U.S. Personal Consumption Expenditures (PCE) index, the Fed’s preferred inflation gauge, met expectations and provided little surprise. Meanwhile, Canadian GDP contracted more than expected in Q2, but markets largely dismissed the news, focusing instead on Q4 outlooks.
Looking ahead, attention will turn to next week’s U.S. labor market data and the Federal Reserve’s policy signals. With month-end positioning already driving volatility, these catalysts could either deepen near-term weakness or provide a relief rally.
Outlook
While Nvidia’s decline sparked immediate volatility, the bigger test for markets will come from upcoming labor data and Fed policy direction, which could define whether this pullback is a temporary shakeout or the beginning of broader risk-off sentiment.
Dow Jones Live Chart
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