Stock Market Update: Dow Rises as S&P 500 and Nasdaq Slip

Jan 9, 2026, 2:46 AM

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US stock markets closed mixed on Thursday, reflecting a shift in investor sentiment as they reacted to new labor market data and President Trump's comments on defense spending. The Dow Jones Industrial Average rose by 0.5%, marking a positive session for the index, while the S&P 500 remained relatively unchanged, and the Nasdaq Composite fell by 0.4%.

The decline in the Nasdaq was primarily driven by losses in major technology stocks, including Nvidia, Apple, and Meta, which have been under scrutiny amid concerns over capital expenditures related to artificial intelligence and other tech investments. This marked the first loss for the tech-heavy index this week, as investors rotated out of high-growth technology stocks into other sectors, particularly defense.

Defense stocks experienced a notable rebound, with shares of Northrop Grumman and Lockheed Martin rising significantly after President Trump announced plans to boost military spending by 50%, aiming for a budget of $1.5 trillion per year. This announcement came after Trump threatened to block share buybacks and dividends for defense companies unless they increased their investments in weapons operations. As a result, Northrop Grumman and Lockheed Martin saw their shares jump as much as 8% before settling down slightly by the end of the trading day.

The broader market sentiment was cautious as investors digested a series of labor market updates. The latest report from Challenger, Gray & Christmas indicated a positive sign for the jobs market, with planned layoffs hitting their lowest level in December 2025. This data is crucial as it sets the stage for the upcoming December jobs report, which is expected to provide further insights into labor market conditions and influence the Federal Reserve's policy decisions.

In addition to labor market data, investors are also closely monitoring potential geopolitical developments, particularly regarding US strategies in Venezuela and Greenland. Trump suggested that the US could oversee Venezuela's oil revenue for an extended period, a statement that has raised eyebrows among market analysts and investors alike.

As the trading week progresses, the focus will remain on the anticipated jobs report, which is scheduled for release on Friday morning. This report is expected to be a key indicator for the Federal Reserve as it navigates its monetary policy in light of current economic conditions. Additionally, a potential Supreme Court ruling on the legality of tariffs imposed during Trump's administration is also on the radar, with Friday being designated as an opinion day for the court.

Overall, the mixed performance of the stock market reflects a complex interplay of economic data, corporate earnings, and geopolitical considerations, as investors remain vigilant in a fluctuating economic landscape. The upcoming jobs report will likely play a significant role in shaping market expectations in the near term.

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