Dow hits record high as AI rally pauses, oil prices retreat

Wall Street closed mixed on Wednesday as the Dow Jones Industrial Average reached another record high, while the S&P 500 and Nasdaq Composite traded little changed as investors paused after a powerful AI-driven rally and monitored developments surrounding Middle East tensions.

The Dow Jones Industrial Average rose 189 points, or 0.37%, to close at 50,650.76, marking a fresh record close.

The S&P 500 edged up 0.02% to finish at 7,520.93, while the Nasdaq Composite gained 0.08% to close at 26,676.60.

The session reflected a rotation away from high-flying semiconductor stocks and toward healthcare and consumer companies as investors reassessed valuations following recent gains in AI-related shares.

Dow gains as healthcare and consumer stocks rally

The Dow outperformed broader indexes as investors rotated into more defensive sectors, including healthcare and consumer discretionary stocks.

Consumer discretionary shares led gains among S&P 500 sectors, while companies such as Procter & Gamble helped support the blue-chip index.

Energy stocks, however, moved lower after oil prices dropped sharply during the session.

US crude oil fell about 5% to near $88 per barrel after Iranian state media reportedly said Tehran remained committed to restoring commercial traffic through the Strait of Hormuz within one month.

The White House later denied the report, calling it a “complete fabrication.”

Investors continued watching geopolitical developments involving Iran closely after recent tensions surrounding US military activity near the Strait of Hormuz.

Meanwhile, JPMorgan Chase shares declined roughly 2% after CEO Jamie Dimon warned that company expenses could rise by as much as $1 billion above earlier estimates.

Dimon also said the bank could potentially spend up to $20 billion on an acquisition “in the next couple years.”

Chip stocks lose momentum after AI-driven surge

Technology and semiconductor shares paused following a powerful rally that recently pushed several indexes to record highs.

Chip stocks broadly weakened on Wednesday, weighing on the Nasdaq and limiting gains for the S&P 500.

Micron Technology, which surged more than 19% Tuesday to surpass a $1 trillion market capitalization for the first time, traded modestly higher but pulled back from session highs.

Other semiconductor stocks, including Intel, Qualcomm, and Marvell Technology, declined during the session.Nvidia also weakened, while the Philadelphia Semiconductor Index retreated after hitting a record high on Tuesday.

Investors await inflation data and Fed signals

Markets are now turning attention toward Thursday’s release of the personal consumption expenditures index, the Federal Reserve’s preferred inflation measure.

The data could provide further clues about the outlook for monetary policy under new Fed Chair Kevin Warsh.

At the same time, optimism surrounding corporate earnings remained supportive for equities.

Goldman Sachs raised its 2026 year-end forecast for the S&P 500 to 8,000 from 7,600, citing continued strength in corporate earnings growth.