The Nasdaq Composite and the S&P 500 rose on strong buying of semiconductor stocks, but a few pricey Dow components dragged on the blue-chip index while investors also looked out for upcoming minutes from the Federal Reserve meeting, new economic data and expectations for future interest rate moves.

US Stock Market Today Snapshot

Dow Jones Today: Key Market Drivers

• The Dow climbed above 53,000 temporarily before falling back from its all-time intra-day peak.
• Shares in semiconductor companies helped boost the Nasdaq index by more than 1%.
• Broadcom jumped around 5.7% following the extension of its custom chip deal with Apple to 2031.
• Stock investors resumed trading following the Independence Day markets holiday and focused on tech stocks.
• Markets look forward to the announcement of Fed meeting minutes for monetary policy hints.
• Drop in crude oil price and reduced chances of rate hikes buoyed overall markets.

Dow Jones Today: Why is Dow Down?

• Nike and Amgen were the major draggers of the Dow during the entire morning session.
• Home Depot, Visa and Honeywell also pulled the index down.
• The Dow could not sustain its rally even when other indices were rising, since the index is more sensitive to higher-priced stocks.
• Profit taking was observed when the index made a new intraday record.
• The rotation from defensive blue chip sectors to technology stocks still took place.

Dow Jones Today: Price-Weighted Reality as Alphabet vs Verizon

• The Dow is not a market cap-weighted stock index but a price-weighted stock index.
• Higher-priced shares have more weightage for influencing the performance of the index each day.
• Each dollar change in a stock in the Dow affects the index by 5.94 points.
• Higher priced stocks can outshine large companies with low share prices.
• This is why the fall in a few expensive stocks had greater weightage than gains in others in the Dow.

Why the Dow is Underperforming the Nasdaq

• The chip stocks were leading the market rebound after profit-taking last week.
• Broadcom, Intel and other chip stocks gained well on the day.
• Technology was the best performing sector on Monday.
• The Nasdaq was buoyed by fresh optimism about artificial intelligence and semiconductor stocks.
• The Dow's exposure to industrial, healthcare and consumer stocks hampered performance even though other sectors were strong.
• The S&P 500 rose as investors diversified their purchases away from mega-cap technology stocks.

Top Dow Jones Gainers Today

Top Dow Jones Losers Today

Dow Jones Today: What Investors Should Watch?

• Meeting Minutes from the Federal Reserve to provide insights into their interest rate decision-making process.
• The behavior of inflation along with the release of other U.S. economic data points.
• Performance of semiconductor and artificial intelligence stocks.
• Announcements of corporate results this month.
• Interest rates, the U.S. Dollar Index, and price of crude oil.
• If the Dow can reach back above its 53,000 milestone.
• According to Trading Economics, the Dow will close the current quarter at about 51,794 and the year 12 months hence at 48,614, indicating the potential for heightened market volatility.

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Disclaimer: The information provided in this article is for informational purposes only and does not constitute financial advice. The Sunday Guardian suggests that readers consult with a certified financial advisor before making any investment or money-related decisions. The stock market involves significant risk.