NEW YORK, New York - U.S. equities closed on Tuesday on a mixed but mostly upbeat note, led by a furious rally in megacap tech names.

The NASDAQ Composite was the day's undisputed champion, surging 233.83 points or 0.90 percent to close at 26,107.01. The tech-heavy index benefited from a broad bid in semiconductor and artificial-intelligence plays, with traders shrugging off valuation concerns ahead of key earnings later this month.

The Standard and Poor's 500 added 28.25 points to finish at 7,543.59, a gain of 0.38 percent, as strength in communication services and consumer discretionary offset weakness in energy and financials. Trading volume on the benchmark index reached 2.761 billion shares.

The Dow Jones Industrial Average, however, barely moved the needle. The blue-chip index eked out a paltry gain of just 9.63 points, closing at 52,508.27—a microscopic advance of 0.02 percent. A slump in healthcare and industrial components kept the Dow anchored near its flatline, even as the broader market rallied.

Small-cap stocks outperformed their large-cap peers on Tuesday, with the Russell 2000 Index climbing 11.60 points or 0.39 percent to 2,964.77, signaling renewed appetite for riskier, domestically focused names.

In a clear sign of cooling anxiety, the CBOE Volatility Index—Wall Street's so-called "fear gauge"—plunged 0.75 points or 4.37 percent to settle at 16.41, its lowest close in recent weeks.

London's FTSE 100 rose 31.10 points or 0.30 percent to 10,529.39, buoyed by a weaker pound and strength in mining and energy shares. The index traded within a session range of 10,422.98 to 10,552.56.

EUROPE: Cautious Gains on Tuesday Across the Continent

European markets closed higher but with noticeably muted momentum on Tuesday, as investors weighed fresh economic data against lingering geopolitical uncertainties.

Germany's DAX P added a more modest 32.78 points or 0.13 percent, closing at 25,147.03, as auto manufacturers pared earlier gains. The index touched a session high of 25,204.68 before profit-taking emerged.

In France, the CAC 40 barely budged, rising just 2.20 points or 0.03 percent to finish at 8,366.85, making it the laggard among major European benchmarks. The pan-European EURO STOXX 50 I gained 9.17 points or 0.15 percent to 6,280.19, while the Euronext 100 Index climbed 4.51 points or 0.24 percent to 1,914.09.

Elsewhere, on Tuesday, in Belgium, the BEL 20 advanced 13.82 points or 0.25 percent to 5,618.27, reflecting a broad but shallow risk-on tone across the region.

ASIA: Shanghai Shines, Taiwan Tumbles

Asian markets delivered a dramatic divergence, with mainland Chinese stocks leading the region while Taiwan suffered a sharp selloff.

The SSE Composite Index in Shanghai was the global standout, rocketing 53.33 points or a robust 1.36 percent to close at 3,967.13, fueled by fresh government stimulus measures and renewed foreign buying. Trading volume reached 2.164 billion shares.

Hong Kong's HANG SENG INDEX joined the party Tuesday, advancing 127.01 points or 0.52 percent to 24,340.73, recovering from an early dip to 23,902.05 and rallying toward the session peak of 24,436.58.

In Southeast Asia, in Malaysia, the FTSE Bursa Malaysia KLCI delivered one of the day's strongest percentage gains, surging 21.50 points or 1.27 percent to 1,719.94. Singapore's STI Index rose 25.27 points or 0.46 percent to 5,495.61, while Indonesia's IDX Composite edged up a marginal 1.68 points or 0.03 percent to 6,039.52.

Japan's Nikkei 225 climbed 500.77 points or 0.74 percent to close at 67,743.50, supported by a weaker yen and strong export-sector demand. South Korea's KOSPI Composite Index gained 49.90 points or 0.73 percent to 6,856.83.

In Australia, the S&P/ASX 200 finished unchanged at 8,808.50—a flat session with zero percent movement—while the broader ALL ORDINARIES slipped marginally by 1.70 points or 0.02 percent to 9,001.30, snapping a recent winning streak.

New Zealand's S&P/NZX 50 INDEX GROSS fell 71.98 points or 0.52 percent to 13,651.22, making it one of the region's weakest performers.

However, in Taiwan on Tuesday, the TWSE Capitalization Weighted Stock Index suffered the day's worst losses, plummeting 642.57 points or a steep 1.42 percent to 44,737.95, as tech exporters were hit by profit-taking and concerns over geopolitical tensions.

India's S&P BSE SENSEX was among the day's notable decliners, dropping 561.46 points or 0.72 percent to 77,054.94, as IT and banking heavyweights came under sustained selling pressure.

EMERGING MARKETS: Mixed Picture Across LatAm and Beyond

Latin American markets were mostly positive, led by Mexico's IPC MEXICO, which jumped 599.17 points or 0.91 percent to 66,572.25, with volume of 93.071 million shares.

In Brazil on Tuesday, the IBOVESPA added 793.75 points or 0.45 percent to close at 176,532.83, while Chile's S&P IPSA rose 53.18 points or 0.49 percent to 10,980.89 on volume of 1.093 billion.

In Argentina', the MERVAL, however, bucked the regional trend, slipping 4,137.00 points or 0.13 percent to 3,231,157.80, as political uncertainty weighed on investor sentiment.

In the Middle East lon Tuesday, Israel's TA-125 advanced 18.16 points or 0.45 percent to 4,022.50, while in Egypt, the EGX 30 Price Return Index fell 309.00 points or 0.59 percent to 52,299.30 on volume of 367.603 million.

South Africa's Top 40 USD Net TRI Index posted a solid gain of 65.56 points or 0.98 percent to 6,726.15.

OUTLOOK

With the Nasdaq leading U.S. gains and Shanghai outperforming globally, Tuesday's session underscored the continued divergence between tech-driven momentum and cyclical caution. Investors now turn their attention to upcoming inflation data and corporate earnings, which are expected to set the tone for the remainder of the week.

FOREX ROUNDUP: U.S. dollar on Tuesday sinks across the board on lower inflation reading

The U.S. dollar suffered a broad and brutal selloff in Tuesday's trading session, with every major currency pairing posting gains against the greenback—save for one notable outlier: the Japanese yen.

In a session defined by shifting interest-rate expectations and a fresh wave of risk-on sentiment, the dollar index tumbled to multi-week lows as traders pared back bets on further Federal Reserve tightening.

Euro Charges Past 1.14

The shared currency was a standout performer, with the EUR-USD pair regaining the 1.1400 mantle to last trade at  1.1420, a gain of 0.34 percent on the day. The break above the psychological 1.14 handle fueled bullish chatter across dealing desks, with analysts pointing to widening U.S.-Eurozone bond yield differentials as the primary catalyst. "

Pound Sterling Extends Rally

Cable followed suit, with GBP-USD climbing to 1.3388, an advance of 0.30 percent. Sterling continued to draw support from sticky U.K. services inflation and hawkish remarks from Bank of England policymakers, who have shown little appetite to follow the Fed down the easing path. The pair now sits at its highest level since early 2024, with the next technical resistance seen near 1.3500.

Antipodeans Lead the Charge

Commodity-linked currencies posted the session's strongest percentage moves on Tuesday. The AUD-USD rocketed to 0.6972, rising a hefty 0.78 percent, as iron ore prices rallied and China's stimulus measures bolstered the outlook for Australian exports. Meanwhile, the New Zealand dollar similarly benefited, though it was the Aussie that stole the spotlight among G10 currencies.

Loonie and Franc Benefit from Dollar Weakness

The U.S. dollar cratered against its North American and European rivals. The USD-CAD pair tumbled to 1.4069, a drop of 0.61 percent, as oil prices held firm above $80 a barrel and the Bank of Canada's hawkish rhetoric contrasted sharply with the Fed's cautious tone.

Even the haven Swiss franc powered higher Tuesday, with USD-CHF sliding to 0.8095—a decline of 0.64 percent—as traders fled the dollar and sought safety in the Alpine currency, despite the broader risk-on mood.

The Yen Stands Alone

In a curious twist, the USD-JPY pair defied the day's dollar-weakness trend, rising to 162.2300—a gain for the greenback of 0.12 percent. That means the yen was the only major currency to lose ground against the dollar on Tuesday. Traders attributed the move to the stark policy divergence between the Federal Reserve and the Bank of Japan, where ultra-loose monetary settings remain firmly in place. "The yen is fighting a one-sided battle," noted a Tokyo-based strategist. "Every other currency is riding the dollar selloff, but the BOJ's inaction is keeping USD-JPY bid."

(This report incorporates quotes retrieved with the assistance of artificial intelligence).

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