Tuesday Markets: Tech Leads Market Gains, Oil Prices Rise, and Fed Outlook

All three major indexes started the second half of the year on a positive note. The tech-heavy Nasdaq Composite reached a new record, gaining 0.83% to close at 17,879.30. The S&P 500 and the Dow Jones Industrial Average also ended higher. The S&P 500 increased by 0.27%, while the Dow rose by 0.13%.

The tech sector saw significant gains, moving 1.3% higher. Key tech stocks Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), and Nvidia (NASDAQ:NVDA) advanced by 2.2%, 2.9%, and 0.6%, respectively. These gains highlight the sector's ongoing strength and its role in driving the broader market upward.

Tesla Faces Challenges in China

Tesla (NASDAQ:TSLA) experienced a decline on premarket, with its stock falling 1.6%. This drop followed a report from the China Passenger Car Association, revealing that Tesla's June sales of China-made electric vehicles fell by 24.2% compared to the previous year.

This news underscores the challenges Tesla faces in maintaining its growth trajectory in the competitive EV market, especially in China, where local manufacturers are rapidly advancing.

Fed Chair J. Powell's Upcoming Comments

Federal Reserve Chair Jerome Powell is scheduled to participate in a panel at a European Central Bank conference in Sintra on Tuesday.

Markets are keenly awaiting his remarks for any new insights on interest rates. Powell's comments will precede the release of minutes from the Fed's June policy meeting on Wednesday. During this meeting, the Federal Open Market Committee (FOMC) indicated that it only expects to cut borrowing costs once this year, down from the three cuts anticipated in March.

Despite this, traders remain hopeful for further reductions in borrowing costs. They are betting on approximately two rate cuts in 2024, starting in September, according to the CME Group's closely-watched FedWatch Tool.

Crude Oil Prices Near Two-Month Highs

Crude oil prices edged up on Tuesday, hovering near two-month highs due to expectations of rising fuel demand during the U.S. summer. By 03:20 ET, U.S. crude futures (WTI) had gained 0.1%, reaching $83.42 a barrel. Similarly, the Brent contract climbed 0.1% to $86.71 per barrel. Both benchmarks had touched their highest levels since late April during the previous session.

The increase in crude prices is linked to the anticipated surge in gasoline demand in the U.S. as the summer travel season picks up, especially around the Independence Day holiday. Traders are also monitoring the latest data on U.S. crude stockpiles from the American Petroleum Institute and potential disruptions from Hurricane Beryl, which could impact oil refining and offshore production in the Gulf of Mexico.

Premarket movers: