Crude oil prices and Treasury yields kept climbing on Tuesday, as the Federal Open Market Committee (FOMC) met to talk about inflation and interest rates. All three main equity indexes opened in the red and trended lower through the trading session.
The front-month West Texas Intermediate crude oil futures contract added another 4.5%, trading as high as $106.75 per barrel before hitting $105.84 at the closing bell.
According to Bloomberg, attacks by an Iran-backed militant group on a land-based pipeline have shut down Saudi Arabia’s attempt to bypass the Strait of Hormuz.
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The 10-year Treasury yield declined from an intraday peak of 5.041%, its highest level since 2007, but was still up 4.1 basis points to 5.002%.
The 2-year Treasury yield hit another 52-week high and was up 3.7 basis points to 4.671%. The 30-year Treasury yield (+3.9 bps, 5.367%) was also higher heading into Wednesday’s FOMC decision.
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Based on data tracked by CME FedWatch, federal funds rate futures prices reflect a 94.5% probability of a 25-basis-point rate cut at the conclusion of the meeting on Wednesday afternoon. That’s up from 93.5% on Monday.
Follow along with all the latest news and updates on our September Fed meeting live blog.
The CEO and the president
At the closing bell, the Dow Jones Industrial Average was down 0.6% at 52,092, the broad-based S&P 500 had shed 0.5% to 7,585, and the Nasdaq Composite was lower by 0.8% at 25,981.
Nvidia (NVDA, +0.6%) was one of 10 Dow Jones stocks in positive territory after CEO Jensen Huang co-signed President Donald Trump’s efforts to ease artificial intelligence (AI) anxiety.
The president and the CEO participated in a live telephone conversation during an event for the All-In podcast, with Trump describing recent expressions of concern about the speed of the AI deployment as a “hoax” and Huang adding “everybody wins in the AI race in America.”
“The AI doomsday selloff due to warnings that AI could kill humans is ridiculous,” Louis Navellier of Navellier & Associates writes. “The order backlogs for the data centers will not stop, since these backlogs now extend well into 2032.”
Chevron (CVX, +2.6%) paced the Dow, as the energy stock continues to outperform the broader market so far this year amid the widening war in the Middle East.
Goldman Sachs (GS, -1.2%) was a big drag on Papa Dow, the financial stock suffering in the aftermath of comments by Bank of America (BAC, +0.03%) CEO Brian Moynihan about third-quarter trading and investment banking activity.
Markets may be a little more cautious about Goldman Sachs ahead of management’s presentation at an industry conference on Wednesday.
SWKS and QRVO surge
Skyworks Solutions (SWKS, +13.6%) posted a double-digit gain a day after posting a double-digit loss, as the semiconductor stock rallied during a mixed session for AI-related names following Monday’s steep sell-off.
SKWS is the smallest holding in the 26-stock VanEck Semiconductor ETF (SMH, +0.1%), the biggest semiconductor ETF. Skyworks makes radio frequency (RF), analog and mixed-signal semiconductors that process continuous physical signals like sound, light and radio waves as opposed to digital ones and zeros. It’s also a major supplier for Apple (AAPL, -0.5%).
Last Thursday, CEO Philip Brace said he was “very confident” Skyworks’ acquisition of fellow chipmaker and Apple supplier Qorvo (QRVO, +9.3%) would close this year. Skyworks and Qorvo agreed last October to combine their respective chipmaking operations in a transaction that valued the prospective enterprise at approximately $22 billion.
“I really think this is a transformative deal for both the company and the industry,” Brace said, noting that the combined entity has “super attractive” opportunities to grow through sales to aerospace and defense contractors.
AXON sinks on notes offering
Axon Enterprise (AXON, -9.8%) was among the worst-performing S&P 500 stocks on Tuesday after management announced a $1 billion offering of 0% senior convertible notes.
The surveillance technology provider will use a portion of the proceeds from the offering to cover the costs of covered call transactions it will enter in order to reduce potential dilution on existing shareholders.
Axon says the remainder of its proceeds will be used for general purposes, such as acquisitions and other efforts to grow the business.
AXON has had an up-and-down 2026, generating a loss of almost 14% through Monday. Wall Street remains bullish, with 18 analysts rating the industrial stock a Buy and three rating it a Hold, according to S&P Global Market Intelligence.