US Stocks Split as Tech Slumps but Earnings Support the Tape

On Monday, July 27, US equities delivered a mixed performance. The Dow Jones Industrial Average eked out gains, while the tech‑heavy Nasdaq Composite slipped, dragged lower once again by selling in AI and semiconductor names. The pullback comes as investors juggle easing inflation fears from a recent pause in oil’s rally with mounting uncertainty ahead of a packed week of mega‑cap tech earnings.

Concerns about the high valuations and rising capital‑expenditure burden of AI leaders remain front and center. That has kept the rotation out of growth stocks and into more defensive sectors—such as staples and utilities that are less sensitive to the business cycle—firmly in place. At the same time, solid earnings from select auto, payments, and consumer companies are preventing a broader capitulation, keeping stock‑picking activity alive beneath the surface.

US 10‑year Treasury yields continue to hover at elevated levels, leaving equity valuations under pressure as investors debate how long policy rates will stay restrictive. Looking ahead, the combination of this week’s earnings deluge and the upcoming Federal Open Market Committee decision, including Chair Kevin Warsh’s press conference, will be crucial in determining whether the current tech and AI sell‑off deepens into a more structural derating or proves to be a temporary shake‑out.