Quarterly Performance: Dow Slumps, Tech Indexes Rise
Wall Street finished the third quarter with divergent results. The Dow Jones Industrial Average dropped 2.7%, weighed down by climbing energy prices and bond yields. In contrast, the S&P 500 added 2% and the Nasdaq Composite gained 2.5%, supported by sustained demand for technology stocks.[S1][S3]
The quarter's sectoral rotation was evident. In July, investors shifted from tech and AI stocks to energy firms, pushing the Dow up 0.3% while the S&P 500 and Nasdaq fell 0.1% and 3.2%, respectively.[S1]
Fed Rate Hike and Bond Market Pressures
The Federal Open Market Committee raised the policy rate by 25 basis points in September to a range of 3.75-4%, marking the first rate hike since 2023.[S1]
Energy Prices and Inflation Concerns
Rising energy prices added to inflation anxiety during the quarter. When shipping through the Strait of Hormuz came to a standstill as tensions mounted among the US, Israel, and Iran, crude prices jumped because supplies were constrained.[S1][S3]
Year-to-Date Gains Persist Despite Q3 Weakness
Even though the third quarter produced uneven results, all three major indexes finished the first nine months of the year in positive territory.[S1]
