The DJIA fell about 120 points (0.24%) on Tuesday. The S&P 500 dropped about 0.5%, and the Nasdaq Composite slid about 0.8%. The Dow and S&P 500 have declined in four of the past five weeks. The Nasdaq started this week after five straight weekly losses.
The 10-year Treasury yield dipped to around 4.03%, a two-month low, after Friday’s cooler-than-expected CPI report. Tech shares were weaker. Salesforce fell about 2.5%, and CrowdStrike dropped more than 2% after a Mizuho rating cut.
Tech And Industrials Slide
Nvidia, AMD, and Broadcom also traded lower. Chevron fell 2.6% and Caterpillar dropped 2.1%. Travelers rose 1.8%, Visa gained 1.5%, and Apple added 1%.
Danaher fell about 6% after agreeing to buy Masimo for $180 per share in an all-cash deal valued at about $9.9 billion. The offer is a 38% premium to Masimo’s Friday close. Masimo shares rose about 34%. The deal is expected to close in the second half of 2026.
Warner Bros Discovery rose more than 2% after reopening talks with Paramount Skydance, which was up about 3%. A seven-day waiver runs through 23 February. Paramount may raise its all-cash offer to at least $31 per share from $30. Netflix’s $83 billion enterprise-value deal remains in place.
The NY Empire State Manufacturing Index came in at 7.1 versus 6 expected, compared with 7.7 in January. FOMC minutes are due Wednesday. Markets are pricing in about two 25-basis-point cuts by year-end, with June seen as the most likely first cut. Friday brings PCE and preliminary Q4 GDP. Palo Alto Networks reports with revenue expected at $2.58 billion and adjusted EPS at $0.94, after beating revenue estimates in every quarter for two years.
Options And Volatility Strategy
With the Nasdaq posting five straight weekly declines entering this week, tech is clearly under pressure. Traders may consider buying puts on tech-heavy indices like the QQQ to hedge portfolios or seek gains if markets fall further. The CBOE Volatility Index (VIX) has climbed to 19.5, up from the low teens seen in late 2025, which points to higher expected volatility.
Worries about how AI may reshape software and hardware are also pressuring sentiment. Buying puts on stocks like Salesforce (CRM) and Nvidia (NVDA) may still make sense as investors question high valuations. Year-to-date, the iShares Expanded Tech-Software Sector ETF (IGV) is down nearly 8%, and the downtrend may continue through month-end.
This week’s FOMC minutes and PCE data are key for rate-sensitive trades. With the 10-year yield near two-month lows, call options on Treasury ETFs like TLT could offer a way to position for even lower yields. The CME FedWatch tool now shows a 75% probability of a rate cut by the June meeting, and Friday’s inflation data will be a major test of that view.
M&A news is also raising volatility in certain names after a slower deal environment in 2025. With the Warner Bros and Paramount talks creating uncertainty, a straddle on Paramount (PSKY) could benefit from a large move in either direction. Danaher’s (DHR) pullback after announcing the acquisition could also be traded with puts if investors continue to focus on the high premium paid for Masimo.
Palo Alto Networks (PANW) reports after the bell, creating a clear options event. Given the stock’s pattern of beating estimates and the current anxiety in tech, a large move is possible. The options market is pricing in an 11% post-earnings move, which makes a long straddle a way to trade volatility rather than direction.
Create your live VT Markets account and start trading now.
here to set up a live account on VT Markets now
