[Christian Harris]

US stocks experienced a pullback on Tuesday, halting a recent rally fueled by post-election optimism.

The S&P 500 declined by 0.3%, the Dow Jones Industrial Average fell 382 points, and the Nasdaq Composite edged slightly lower.

Notable individual stock movements included a 6.1% drop for Tesla and an 8.8% decline for Trump Media & Technology Group.

On the other hand, Nvidia, Microsoft, and Alphabet gained 2.1%, 1.3%, and 0.7%, respectively.

Sector-wise, materials, real estate, and utilities were among the biggest losers, while communication services and technology led the gains.

Investor sentiment softened as concerns about economic challenges, profit-taking after recent record highs, and rising Treasury yields, including a 10-year yield of 4.43%, weighed on the market.

Market participants are now focused on upcoming economic data, particularly the Consumer Price Index (CPI), as they seek clues about the Federal Reserve’s future monetary policy.

Data: Trading Economics, FactSet, Morningstar, S&P Capital IQ, ProRealTime, MarketScreener

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[Steve]

Neat overview.

I thought this was an interesting read concerning the growing divide between US and European equity markets: https://www.xtb.com/en/market-analysis/can-anything-stand-in-the-way-of-the-us-stock-market-rally.

• The expected growth disparity between the US and Europe (2.2% vs. 1.2% in 2025).
• US companies, particularly in tech and consumer sectors, are outperforming earnings expectations, while European stocks are lagging behind.
• The tech sector, especially large-cap stocks like Tesla and Palantir, is dominating post-election, but smaller US companies may struggle with inflation and tariffs.
• Strong momentum and investor optimism, fueled by the “Trump trade,” continue to give US stocks an edge over European counterparts, especially in tech.

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[Christian Harris]

A neat referral Steve.

I agree with the article’s positive US sentiment.

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