Midday trading saw sharp moves across several Wall Street groups, with housing and AI-related infrastructure stocks sliding as investors leaned toward lower risk. At the same time, biotechnology and select healthcare names rallied on clinical and business developments, while semiconductors dragged on rising Treasury yields.
Key takeaways
- Housing and AI infrastructure shares fell as construction spending declined and investors went “risk off,” with the iShares U.S. Home Construction ETF down nearly 2% and the AI innovation ETF dropping more than 1%.
- Rising Treasury yields pressured chip stocks, sending the VanEck Semiconductor ETF down more than 2% as rates moved higher.
- Moderna jumped after earlier August strength, gaining about 5% midday as investors weighed progress on a cancer vaccine in a late-stage setting.
- Cybersecurity stocks slid before results, with Palo Alto Networks down more than 5% ahead of its after-bell earnings report.
- Energy and select healthcare gained, supported by firmer oil prices and positive clinical or guidance updates, including a 6% rise for Novartis.
Housing stocks reel on softer construction activity
Companies tied to homebuilding fell after U.S. construction spending dropped 0.5% in July to the lowest level since October 2023, according to the trading snapshot. The weakness spilled into major housing-related names: Builders FirstSource slid 4% and LGI Homes dropped 3%, while Home Depot fell about 2%.
Sector ETFs mirrored the broad decline, with the iShares U.S. Home Construction ETF dropping nearly 2%. The move reflects investor sensitivity to the housing pipeline and construction economics, especially when macro indicators point to cooling activity.
AI infrastructure and semiconductors slip as rates rise
AI-linked infrastructure stocks generally traded lower as sentiment turned cautious. Data showed weakness across exchange-traded exposure: the iShares A.I. Innovation and Tech Active ETF fell more than 1%, while Lumentum dropped more than 5%. Teradyne slid 5% and Coherent fell about 2%.
Semiconductors also weakened at the start of the new month as Treasury yields rose and pressured the wider market, according to the report. The VanEck Semiconductor ETF fell more than 2%, with Nvidia down about 1%, AMD off 3%, and Micron down roughly 2%. Investors typically interpret higher yields as less favorable for longer-duration equities, including parts of the chip complex tied to rapid growth expectations.
Healthcare rallies on trial updates and guidance
Biotechnology and healthcare names provided a counterweight to the broader risk-off tone. Moderna gained about 5%, building on a strong August run of 156% after initial positive results from a cancer vaccine co-developed with Merck in its first-ever late-stage trial, the report said.
Novartis rose around 6% on positive trial data for its multiple sclerosis drug. The company said remibrutinib “significantly” reduced relapse rates in MS patients compared with other treatments, prompting a sharp rerating by midday.
Medtronic added about 2% after raising its outlook for fiscal 2027. The medical technology company expects earnings per share between $5.94 and $6 for the fiscal year, up from a prior range of $5.90 to $6, according to the report. Guidance increases often support near-term positioning, particularly when investors are calibrating expectations around margins and demand durability.
Cybersecurity and consumer tech: results risk and leadership changes
Cybersecurity stocks fell as earnings approached. Palo Alto Networks dropped more than 5% ahead of its after-bell report, with analysts surveyed by FactSet expecting earnings of 98 cents per share on revenue of $3.35 billion, the report said. The broader theme hit ETFs and peers as the Global X Cybersecurity ETF fell about 5% and CrowdStrike declined more than 6% on the day.
Apple shares rose about 3% after leadership changes were reported. John Ternus took over as Apple’s CEO on Tuesday, while Tim Cook stepped into the role of executive chairman. Investors appeared to treat the transition as supportive rather than disruptive, lifting the consumer technology giant during midday trading.
Other notable movers: geothermal power deal, language app upgrade, and oil-linked strength
Fervo Energy jumped more than 25% after announcing a 396-megawatt power purchase agreement with Google. The company said it would deliver from its Cape Station geothermal project in Utah, expected to come online in 2028, and noted the deal is the world’s largest enhanced geothermal power purchase agreement to date, according to the report. The announcement broadened attention to clean power supply chains tied to data-center buildouts.
In consumer software, Duolingo gained about 5% after an upgrade by Evercore ISI to outperform from in line. Evercore analysts pointed to strong survey data, the report said.
Energy stocks moved higher alongside oil prices as tensions in the Middle East persisted. The State Street Energy Select Sector SPDR ETF rose nearly 1%, while EOG Resources gained about 2%, and Diamondback Energy and Chevron advanced roughly 1% each. The pattern suggests investors are keeping a close watch on supply risk and the cost of crude as a driver for cash flows across the sector.
What to watch next: The trading day is likely to hinge on upcoming earnings releases—especially Palo Alto Networks after the bell—as well as continued market sensitivity to Treasury yields and the direction of oil prices. For investors, guidance updates like Medtronic’s and trial catalysts like Novartis’s and Moderna’s remain key near-term drivers in healthcare, while macro data and rate moves may continue to determine the pace of volatility in semiconductors and AI-adjacent infrastructure.
