Dow Hits Record Highs, Oil Sinks To $77 Ahead Of Warsh’s Debut – State Street Utilities Select Sector SPD

U.S. stocks were mixed at midday Tuesday as money rotated out of high-flying technology and into financials, utilities and industrials — cooling the tech-led rally as the Dow Jones Industrial Average pushed to fresh records.

Meanwhile, Federal Reserve Chair Kevin Warsh prepares to gavel in his first policy meeting — a two-day gathering that concludes Wednesday.

Futures price a roughly 97% chance the Fed holds its benchmark rate at 3.5%-3.75%, but markets still assign about 70% odds to at least one hike before year-end, leaving Warsh’s debut press conference as the session’s gravitational center.

Crude Extends Slide

West Texas Intermediate fell roughly 4% to around $77 a barrel, a two-month low, as the framework deal to reopen the Strait of Hormuz — a memorandum of understanding due to be signed Friday in Switzerland – eased the war-risk premium that had gripped energy markets since the spring. Brent traded near $80.

Across U.S. equity markets by midday Tuesday, the split was stark.

The S&P 500 slipped about 0.2% to 7,542.80, while the Dow Jones Industrial Average outperformed, rising 1.0%, or roughly 515 points, to a record 52,185.49 as banks and industrials did the heavy lifting.

The Nasdaq 100 was the laggard, falling about 1.4% to 30,118.05 as megacap tech retreated. The small-cap Russell 2000 dipped about 0.3% to 2,957.29, while the Cboe Volatility Index eased 2.0% to 15.87, signaling a calm tape beneath the rotation.

Tuesday’s Performance In Major US Indices

According to the Benzinga Pro platform:

Banks And Utilities Lead As Tech Gives Back Monday’s Surge

The Energy Select Sector SPDR Fund (NYSE:XLE) slipped roughly 0.7% in sympathy with the crude rout.

Among The Day’s Biggest Advancers

Talen Energy Corp. (NASDAQ:TLN) jumped about 7.2% after closing a $2.55 billion cash-and-stock deal for three Western PJM gas plants that it said is immediately accretive, adding more than 15% to cash flow per share.

Western Digital Corp. (NASDAQ:WDC) gained roughly 7.0%, after Monday’s 16% rally.

The Deepest Losses Came From Chemicals

Cboe Global Markets, Inc. (BATS:CBOE) slid about 6.2% as competitors launched high-profile SpaceX equity options across rival exchanges, stoking fears of lost market share.